Liquor prices in Kerala hiked marginally

Kerala liquor prices rise due to raw material costs, sales tax hike, and political controversy.

Liquor prices in Kerala increased marginally from Monday (January 27, 2025). 

The price increase ranges from ₹10 to ₹50 per 750 ml bottle sold through government-owned liquor retail shops in the State.

Distilleries supplying Kerala had flagged an increase in the price of raw materials, chiefly molasses. They requested that the Kerala State Beverages Corporation (Bevco), a State-owned liquor retail monopoly, increase the procurement price.

The liquor companies argued that distilleries exporting liquor to Kerala from other regions did not face a turnover tax and demanded a level playing field.

The government refused to increase the procurement price of liquor but agreed to renounce the 5% turnover tax on liquor produced in Kerala.

However, the government hiked the sales tax on liquor by 4%. It also increased BEVCO’s warehouse margin by 1% to offset the revenue loss caused by the rollback of the turnover tax. The Kerala government currently imposes a prohibitive 251% sales tax on liquor retailing in the State. 

In a statement, Leader of the Opposition V.D. Satheesan slammed the liquor price hike. He said unreasonably hiking liquor prices would upend family budgets and exacerbate the cost of living crisis. “The decision will reduce the amount of hard-earned money reaching the hands of homemakers. Moreover, prohibitive liquor prices will not reduce consumption”, he added.