1. Liquor ban in Kerala: State rolls back prohibition, allows sales in star hotels

Liquor ban in Kerala: State rolls back prohibition, allows sales in star hotels

It's difficult to quit once you have started. While that is true of people consuming alcohol, it may also be true for states that stand to gain from taxing alcohol.

By: | Published: June 12, 2017 5:46 AM
Liquor ban, Liquor ban Kerala, Liquor prohibition, Liquor ban five star hotels, Pinarayi Vijayan Although CM Pinarayi Vijayan claims that loss of tourism and jobs was the reason behind reversal, the optics of UDF decision never made sense as drug consumption increased as did bootlegging. (Representative Image: Reuters)

It’s difficult to quit once you have started. While that is true of people consuming alcohol, it may also be true for states that stand to gain from taxing alcohol. So, it is not surprising that Kerala is returning to the old days. The state, which has a high per capita consumption of alcohol—at 8.3 litres, it is double the national average of 4 litres—had brought in a near-complete ban on alcohol under the last government, but the current LDF government is lifting the ban. In a reversal of the prohibition—the previous UDF government had envisioned a complete ban by 2025—on Thursday, the state government notified that it will allow three-star and four-star hotels to run bars, while two-star hotels will be allowed to run beer/wine parlours. Moreover, the state will provide relief for bars/ hotels that have been affected by the SC order banning liquor sale 500 metres from the highway, besides allowing them to stock toddy, the local brew.

Although CM Pinarayi Vijayan claims that loss of tourism and jobs was the reason behind reversal, the optics of UDF decision never made sense as drug consumption increased as did bootlegging. In the years before the alcohol ban, 2008-13, cases registered under the Narcotic Drugs and Psychotropic Substances Act averaged 718 annually, but for the three years after the ban the average shot up to 4,087. Similarly, the ban also caused bootlegging to rise—cases registered under the state Abkari Act that regulates taxation of manufacture or sale of alcohol climbed from 48,828 in 2013 to 65,069 in 2016. More important, the state should now be able to reverse the loss in revenue—alcohol industry contributed Rs 8,433 crore in FY14. With bars back in Kerala, it remains to be seen how long Bihar and the others will be able to sustain their respective liquor bans.

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