Liquor to be cheaper in Meghalaya as tax rate goes down

Liquor rates in Meghalaya are all set to go down as the state government has reduced Value-Added Tax (VAT) on various brands besides removing lifting charges.

Meghalaya cabinet on February 26 reduced VAT on various brands of liquor by bringing it down from 40 per cent to 37.5 per cent as well as doing away with the 25 per cent lifting charges.

Excise minister Kyrmen Shylla said that the decision to reduce VAT will not affect the revenue generation, because the volume of sales will increase after the price of liquor has come down.

He said that the revenue from excise during 2019-2020 was Rs 276 crore and Rs 269 crore during 2020-2021 till January.

“We hope the revenue will be more in this current financial year, than last year, because we have two months more – February and March,” Shylla said.

On the other hand, deputy chief minister Prestone Tynsong said that the state will be losing annual revenue to the tune of Rs 80-85 crores.

When asked why did the Meghalaya government reduced VAT on liquor if the state is losing revenue, the deputy chief minister informed that this was done since Assam drastically reduced tax on alcohol.

“We are living in a competitive world, be it between one state government and another. In the last budget session of Assam, they reduced it drastically where ultimately the price of liquor has come down and the difference in the cost is not less than Rs 10 to Rs 50, so we are bound to reduce it,” he said.

Moreover, Tynsong said if the government does not reduce then the turnover will drastically come down.

“As I told you we are in the field of competition ultimately we are bound to reduce tax on liquor,” he added.

On February 12, the Assam government decided to drop 25 per cent cess on alcohol.

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