Budget 2018: This is what going to happen to prices of liquor…

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Budget 2018 was presented to Parliament yesterday by Finance Minister Mangala Samaraweera includes several proposals concerning the Excise Duties imposed on liquor, canned beer, non-potable alcohol and raw material used for manufacturing of ethanol.

According to the budget proposals an alcohol volume based Excise Duty depending on the type of liquor will be introduced as follows:

Hard liquor – Rs. 3,300 per litre
Beer – Rs.2,400 per litre
Wine – Rs.2,400 per litre

An excise duty will be imposed on the import of non-potable alcohol at Rs.15 per Kg.

Excise Duty will be also imposed on raw materials used for manufacturing of ethanol.

A proposed duty of Rs.05 will be imposed per litre of Toddy while Rs.10 will be imposed per Kg on Molasses/Maize/Rice/Fruits.

The Excise (Special Provisions) Duty applicable on canned beer will be removed, the report said.

Meanwhile the rate structure of Liquor license fee will be simplified with effect from January 01, 2018.

The issuance of new liquor license will be simplified to promote tourism, it said.

Changes to Excise Duty will be published by Gazette.

Delivering the budget speech, the minister had said that out of the total liquor consumption, almost 49% is from illicit sources while 85% consume hard liquor.

“However, in most countries, the tax structure is designed to discourage the consumption of hard liquor and is often proportionate to the alcohol content. We will rationalize the tax structure based on a formula linked to the alcohol content and type,” he said.

Further, he added that NBT will be imposed on liquor with effect from April 01, 2018.

The minister also announced a Sugar tax on sweetened beverages. Excise duty based on the quantum of sugar contained will be introduced for the beverages with added sugar.

This duty is applicable for beverages classified under HS Code 22.02. The rate will be 50 cts per gram of sugar.

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