Liquor makers urges Delhi government to withdraw 70 pc additional tax

Liquor makers have urged the Delhi government to withdraw 70 per cent additional tax imposed on liquor in the city, calling the move 'counterproductive'.

The price increase, after the demand surge is over, would lead to decline in sales and also encourage illegal supply from neighbouring states, having lower price, the Confederation of Indian Alcoholic Beverage Companies (CIABC) said in a letter to Delhi government.

"In our understanding this decision may perhaps have either or both of two objectives one to raise more revenues for the government and two, to manage crowd at liquor outlets," CIABC Director General Vinod Giri said.

"It is our humble view that this decision may prove to be counterproductive and suboptimal for both objectives as explained below," he added.

Once the initial surge of panic purchase is over, this kind of price increase will have strong adverse effect on sales in Delhi, he said.

"It will be further compounded by free flow of unlawful liquor from neighbouring .