Alcohol gets costlier in Maharashtra: Excise duty on IMFL hiked by 50%; Maharashtra-Made Liquor debuts

Liquor

The Maharashtra government on Tuesday approved a hike in excise duty on Indian Made Foreign Liquor (IMFL), country liquor, and imported alcohol. The government also cleared the introduction of a new category, Maharashtra Made Liquor (MML), in a bid to expand the state’s revenue base, The Indian Express reported.

The state cabinet, led by Chief Minister Devendra Fadnavis, approved the Excise Department’s recommendations after a secretary-level study group reviewed best practices from other states. The decision is expected to raise the state’s annual excise collection by approximately Rs 14,000 crore.

The highest increase is for premium foreign liquor brands, which will now have a minimum retail price of Rs 360. Indian-made foreign liquor with a declared manufacturing value of up to Rs 260 per bulk litre will now face a higher excise duty, going from three times the manufacturing value to 4.5 times. For country liquor, the duty will rise from Rs 180 to Rs 205 per proof litre, according to a report by NDTV Profit.

With the new duty rates and price rules, the minimum price for 180 ml bottles will be:

Country liquor: Rs 80 (up from Rs 70)

Maharashtra-made liquor: Rs 148 (new product)

Indian-made foreign liquor: Rs 205 (up from Rs 110-115)

Premium foreign brands: Rs 360 (up from Rs 210)

Besides increasing excise duties and prices, the cabinet also raised the annual license fees for alcohol-selling outlets. Sealed foreign liquor retail licences (FL-2) will cost 15 per cent more, while hotel and restaurant licences (FL-3) will see a 10 per cent hike.

Maharashtra-made liquor

A new type of liquor, called Maharashtra-made liquor (MML), has also been introduced. This grain-based alcohol will be made only by local manufacturers, who must register new brands under this category.

MML will have a country liquor tax structure but will only be sold through FL-2 and FL-3 licensees. The government estimates the current size of this segment at 5–6 crore litres, which could potentially grow to 10–11 crore litres, generating up to Rs 3,000 crore in additional revenue.

AI-controlled monitoring system

To improve management and monitoring, the government is setting up a control room that uses artificial intelligence to track distilleries and liquor companies across the state. A new divisional office will open in Mumbai, along with superintendent offices in six districts: Mumbai suburbs, Thane, Pune, Nashik, Nagpur, and Ahilyanagar, the NDTV Profit report said.

To support these changes, the cabinet approved 1,223 new job posts in the Excise Department, including 744 fresh positions and 479 supervisory roles. A special committee also studied practices from other states to help improve Maharashtra’s liquor policies.

However, experts from the alcoholic beverage industry have expressed concern over the steep tax.

“Maharashtra was the most highly taxed state in the country in terms of this industry. The new decision is likely to make the situation worse. High prices in a particular state leads to the smuggling of alcohol from less taxed states or from neighbouring states. I think this decision is far from ground reality and not a good decision,” Pramod Krishna, former Director General, Confederation of Indian Alcoholic Beverage Companies was quoted by The Indian Express as saying.