NEW DELHI: The state’s excise tax policy to regain the lost revenue caused by Covid-19 is having a positive effect on the Indian beer industry, which had stalled last year.
With the help of the tailwind in summer, local breweries were not only able to slow down the decline in sales, but also fall back on the values before Covid.
“In East and West Bengal in particular, the beer industry is growing by more than 50% due to a continuing change in the tariff structure that has improved price accessibility for consumers,” said Kartikeya Sharma, President of India & South East Asia, AB InBev. “North and South India are expected to recover to 2019 levels due to the low rate of Covid infections and a favorable tax climate for beer,” he said.
In Uttar Pradesh, for example, excise duties on volume-increasing 500ml beer cans, which make up 70% of total beer volume, have been cut by almost a third.
“A top brand 500ml can costs 110 rupees instead of 130 rupees,” said a UP-based liquor retailer. “The state has not proposed a retail license renewal fee increase. The margins in wholesaling and retailing have also increased. ”
“Quarter-over-quarter sales improved and the December quarter was 15 to 20% lower than the same period last year,” said a senior industry manager at one of India’s largest beer companies. “States that have renounced Corona Cess have done better.”
In Rajasthan, one of the largest beer markets in India, the announced tariff increases for foreign spirits produced in India (IMFL) and the promotion of the promotion of spirits produced in Rajasthan (RML) should boost beer sales.
“Delhi has lowered the age limit for obtaining and consuming alcohol. UP has drawn up a personal bar permit that allows residents to store more liters in their respective homes, ”said Rahul Kapur – Partner at Grant Thornton Bharat. “Many states have now updated excise tax norms aimed at stimulating alcohol consumption.”
“The lowering of excise duty on beer in the spirits industry in certain parts of the country will certainly boost beer consumption in the respective states,” said Prabhtej Singh Bhatia, co-founder and CEO of Simba Craft Beer.