After nearly six months of closure due to the coronavirus-induced lockdown, bars would be re-opened in Andhra Pradesh from Saturday. The state government, however, decided to levy a 20 per cent ‘COVID-19 fee’ on the basic licence of bars and also a 10 per cent additional retail excise tax on liquor.
The state would earn Rs 40 crore in the form of the COVID-19 fee and another Rs 300 crore as additional retail excise tax. Special Chief Secretary (Revenue) Rajat Bhargava said the government decided to continue all the 840 bar licences, existing as on June 30, 2020, till June 30, 2021, subject to the outcome of a pending batch of writ petitions in the High Court.
On September 3, the state had reduced prices of liquor by Rs 10 to Rs 280 in two categories apart from beer, to bring parity in rates with neighbouring states like Telangana and Karnataka to check smuggling. The rate reduction was also aimed at preventing habitual tipplers from reportedly consuming hand sanitisers that in recent days caused many deaths in the state.
However, the government enhanced the price of “premium and super premium” liquor to “rationalise” the rates so that the overall hike remains at 75 per cent, as effected in October last year and again in May this year, citing the overall revenue loss caused by coronavirus pandemic. But, the government did not suffer any loss in revenue from Excise despite the dip in volumes because of the liquor price hike.
Since the coronavirus pandemic, 16 people have died in Prakasam district, five in Visakhapatnam, three in Chittoor and two in Kadapa. The Special Chief Secretary had at the time pointed out that the measures taken by the state government, including steep hike in prices, led to a drastic fall in liquor consumption in the state in recent months.
Various states have moved to issue special coronavirus cess on liquor since the Covid-19 pandemic. In May, Delhi imposed a 70% ‘Special Corona Fee’ on its sale in the national capital, in a move to boost the government revenue hit hard due to the coronavirus-forced lockdown. Other states who have initiated a similar move are Assam, Meghalaya, Karnataka, Andhra Pradesh, Telangana, Uttar Pradesh, Haryana, Rajasthan, Tamil Nadu and West Bengal.