Haryana council of ministers has approved the state’s liquor excise policy of 2023-24 that allows corporate offices in the state with at least 5,000 employees and a minimum covered area of 100,000 square feet in a single premises to possess and consume alcohol.
The policy, which comes into effect on June 12, will also reduce excise duty on mild beer, wine, and draught beer, as well as annual fee for bar licences in restaurants, pubs and cafes.
Executives at alcobev firms said the state’s decision will redefine liquor consumption in Gurgaon, home to some of the biggest corporate offices in India.
“We will be working with large corporates to set up infrastructure and operate these licences,” said Rahul Singh, founder of beer and pub chain Beer Cafe. He said “clear-cut guidelines” on the office size and minimum number of employees will ensure that the licence is not misused.
“The reduction in annual fee for bar licences in restaurants, pubs and cafes will help our industry to bounce back stronger from the unprecedented pandemic infused disruptions,” Singh added.
Anasuya Ray, vice president, corporate affairs, at AB InBev India, the India unit of the world’s largest brewer which makes Budweiser beer, welcomed the decision to tax low-alcohol beverages like beer lower than hard spirits. Maximum impact in Gurgaon
“The policy will also improve ease of doing business in the state and enable consumers to opt for premium brands with improved retail access,” she said.
Alcobev as a category has been heavily restricted and is taxed at multiple levels in different states, which executives said hampers industry growth.
While the policy is for the state of Haryana, executives said the maximum impact would be in Gurgaon, with its large cluster of multinational and domestic companies across sectors including technology and IT services, automobiles, consumer goods and consultancy firms.
An executive at a large Gurgaon-based tech company said the policy would specially be an added perk for offices where employees work in shifts and late hours. He requested not to be named since he is not the company spokesperson.
Ashish Kapur, promoter of premium bar chains Whisky Samba and Wine Company, said the new Haryana excise policy “will spur demand for the entire category in the state”.
“Reduction in excise on low-alcohol drinks and ready-to-drink beverages will fuel demand from young consumers and encourage so many newer entrepreneurial brands, as well as categories such as premium wines,” he said. “Also, lowering excise fee for bars will encourage people to drink in organised premises and hence will promote responsible drinking.”
Executives urged other states to follow the Haryana policy to promote overall alcobev consumption.
“States have typically increased excise on liquor; that’s killing the ecosystem. What needs to be done is lower the excise duties and promote responsible drinking,” Kapur said.
The policy includes key provisions for small scale breweries, and has said caution sign boards will be compulsory for hotels, pubs and restaurants serving liquor.
Nita Kapoor, chief executive of International Spirits and Wines Association of India (ISWAI), said the policy needs to also include digitisation. “Digitisation is a key industry ask, especially with respect to label and pricing approvals. Currently, these are done manually and are time-consuming, leading to operational delays,” she said.
According to the policy, the minimum area of a canteen or eatery where licences will be granted must not be less than 2,000 square feet, and will be given on payment of a fixed fee of Rs 10 lakh annually.
