The Kerala cabinet meeting held here on Wednesday decided to hike the tax rates on liquor, beer and wine ranging from 10 to 35 per cent.
The office of Chief Minister Pinarayi Vijayan said that this has been done to tide over the difficulties faced on account of the lockdown and an ordinance to this effect will be issued soon.
"The tax rate on beer and wine would go up by 10 per cent, while all forms of liquor will be taxed by an additional 35 per cent," said Vijayan.
The liquor vends and bars are all closed and in all likelihood, might open very soon.
The state exchequer has been reeling under lack of revenue and last month all what the state government could collect from various sources was a mere Rs 250 crore.
For fund-starved Kerala, revenue from liquor and beer is one of the biggest cash cows and in the last fiscal, garnered it a total of Rs 14,504.67 crore and hence the devolution of IT into Bevco, would be a big relief for the state's finances.
The profile of liquor users in the state, in a study conducted earlier, reveal that around 32.9 lakh people - 29.8 lakh men and 3.1 lakh women - out of the state's 3.34 crore population consume liquor.
Around five lakh people consume liquor on a daily basis. Of this, 83,851 people, including 1,043 women, are addicted to alcohol.