ITDC seeks customs duty relaxation to boost liquor sales

Kavita K Bhaskaran

New Delhi, Jan 7: India Tourism Development Corporation (ITDC) has asked the Central Board of Excise and Customs (CBEC) to relax restrictions on purchase of liquor by outgoing passengers to boost sales.

ITDC, in its request to CBEC, has pointed out that despite various promotional schemes and price slash at its duty-free outlets, the customs duty and the restriction on purchase was affecting its sales adversely.

It said, “there are no such restrictions in any other country except India. Because of the existing norms there has been a steep fall in liquor sales at ITDC outlets.”

The present custom duty prevents any incoming passenger from buying more than one bottle of liquor and wine each, and outgoing travellers from picking up more than three bottles. ITDC told the CBEC that “the strict customs rules have been dampening any promotional programmes planned by ITDC to increase liquor sales.”

It said “while many countries do impose some limitation on the quantity of imported liquor and cigarettes to protect domestic players, there is no such restriction on outgoing passengers. The restriction in India limits the scope of foreign exchange earnings from duty-free sales.” Liquor accounts for a large share of duty-free business at airports.

The prices of some brands of liquor and wines have been slashed and promotional schemes introduced at ITDC duty-free outlets to make buying more attractive. However, due to the existing customs norms these promotional schemes have not taken off well nor have sales increased.

Sources in ITDC said, “The customs department has also been very strict with these rules on passengers, as they cannot carry more than the allowed quota. Most passengers ask their fellow passenger to buy their quota in case they are not using it.” Sales have also fallen due to drop in traffic and availability of more attractive deals at other foreign airports. There is a huge inventory that has piled up at ITDC’s duty-free outlets.