The Confederation of Indian Alcoholic Beverage Companies (CIABC) has requested the central government to revise the Model Excise Policy and implement it uniformly across the country.
As per the Indian constitution, the alcoholic beverages segment is a state subject. Hence, state governments are allowed to frame their own taxation structure and policies pertaining to this sector.
As a result, there is no uniform taxation regime or policy structure related to the alcoholic beverages sector. To address this issue, the Ministry of Food Processing Industry(MoFPI) had formed a Joint Working Group for drafting the Model Excise Policy. The policy was issued in 2006. However, the ministry is yet to implement the policy across India.
SMEs press for government regulation
According to small players in the alcoholic beverages segment, implementation of the revised Model Excise Policy will provide an impetus to the sector. “The lack of uniform policies and tax structures related to the alcoholic beverage industry in India has added to our operational difficulties. The central government should therefore enforce a policy that would benefit small players like us,” opines Pratap Talwar, proprietor of Amber Distilleries Ltd, a small-sized alcoholic beverages manufacturing company in Thane.
The CIABC has also appealed to the central government to review the Excise Price Slabs in the Model Excise Policy. In addition, the apex body of the alcoholic beverages segment has suggested the removal of all levies such as Privilege fee, Gallonage fee and Octroi tax to ease the tax burden on cash-starved SMEs.
“The alcoholic beverages segment in India has been neglected for long. It has therefore become important to support this ailing segment, constituted primarily by SMEs. The government should also fix the retail and wholesale margins to implement a uniform Market Retail Price (MRP). By taking these necessary measures, the central government would not only boost the alcoholic beverages segment but would also augment its revenues,” says Sadhan Sarkar, Manager, MLS International, a small-sized alcoholic beverages distributor in Agartala.
With the MoFPI assuring full cooperation to the alcoholic beverages segment, industry players can now heave a sigh of relief. Shubhomita Bose |
