Maharashtra hikes excise duty on liquor, introduces new category: Details

Facing a financial crunch due to its welfare schemes, the Maharashtra government has decided to raise excise duty on Indian-Made Foreign Liquor (IMFL) and country liquor, aiming to bolster its revenue stream.

According to news agency PTI, the state Cabinet has approved an increase in the excise duty on IMFL, raising it from three times to 4.5 times the declared manufacturing cost, up to ₹260 per bulk litre. Additionally, the duty on country liquor will rise from ₹180 to ₹205 per proof litre.

The government has also introduced a new category: Maharashtra-Made Liquor (MML), which will be grain-based. This locally produced liquor will require fresh registrations from manufacturers, aiming to expand the local liquor industry.

Revised liquor prices across categories

The government has revised the minimum retail prices for 180 ml bottles across liquor categories. Country liquor will now retail at ₹80, up from ₹70. MML will retail at ₹148, while IMFL will cost ₹205, up from ₹110–₹115. Premium foreign liquor will now cost ₹360, a steep rise from the earlier ₹210.

Revenue boost expected

Officials estimate that the excise duty hikes will generate an additional ₹14,000 crore annually for the state exchequer. Maharashtra’s financial stress is partly due to welfare schemes like the Ladki Bahin Yojana, which pays eligible women ₹1,500 per month.

According to a note from the Chief Minister's Office, “The decisions in the Cabinet were taken after a high-level study of best practices in other states, covering excise duty structures, licensing, and tax collection.”

To manage the expanded scope of excise activities, the state has approved the creation of 1,223 new posts in the excise department — 744 regular positions and 479 supervisory roles.

The state government is expected to table the relevant bill during the upcoming session of the state legislature.

Alcohol prices across Indian cities

Karnataka currently levies the highest liquor taxes in the country, with an 83 per cent cess on the actual price. In addition, the state government introduced a 5 per cent additional excise duty on certain products last month. As a result, Bengaluru has become the most expensive metro city for alcohol in India.

In Telangana, liquor prices are shaped by a combination of state excise duty, special excise cess, and government-controlled pricing. In mid-May, the state government issued an order raising the retail price of select liquor brands by ₹10 for a quarter bottle (180 ml), ₹20 for a half bottle (360 ml), and ₹40 for a full bottle (750 ml).