The Karnataka government has proposed a significant overhaul of its liquor taxation policy, moving toward a system that targets both the price of the bottle and the strength of the pour. By introducing the “Alcohol-in-Beverage” (AIB) metric, the state aims to standardize how excise duties are calculated across all categories, from craft beers to premium whiskies.
Key Highlights of the Proposed Policy
The draft notification outlines a shift from flat rates to a dual-parameter framework. Here’s how the new structure breaks down:
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The AIB Metric: Tax will now be formally tied to the “Alcohol-in-Beverage” measure—essentially the volume of pure alcohol per litre.
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Beer Strength Slabs: Taxation for beer is now split by potency.
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Up to 5% alcohol: ₹12 per bulk litre.
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5% to 8% alcohol: ₹20 per bulk litre.
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Price-Linked Escalation: Additional Excise Duty (AED) will scale sharply based on the declared price per case.
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Economy Brands: Low-end spirits (under ₹470/case) will see duties as low as ₹50 per litre of pure alcohol.
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Premium Brands: High-end spirits (above ₹5,001/case) could face duties up to ₹3,700 per litre of pure alcohol.
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Civilian vs. Defence Channels
The amendment maintains a stark contrast between commercial sales and institutional supplies. While regular commercial Indian Made Liquor (IML) faces a duty of ₹1,000 per litre of pure alcohol, supplies to defence and paramilitary canteens remain significantly lower at ₹50 per bulk litre (for standard 42.8% v/v spirits).
What Happens Next?
The draft is currently in a seven-day public consultation phase. Citizens and stakeholders have one week to submit objections or suggestions before the government moves toward final consideration and implementation.
The Bottom Line: If you prefer premium labels or high-gravity beers, your next trip to the store in Bengaluru is likely to be considerably more expensive.
