AMENDMENT LIKELY AT AUGUST 27 ASSEMBLY SESSION
In a significant development Thursday, the government of Nagaland has admitted that as the Nagaland Liquor Total Prohibition (NLTP) Act 1989 has not succeeded, the cabinet at its meeting at Nagaland Civil Secretariat, decided to revisit the Nagaland Liquor Total Prohibition (NLTP) Act, 1989, with the possibility of partially lifting the prohibition in certain areas. The government may introduce amendments to the NLTP Act during the upcoming Assembly session on August 27.
According to AIR Kohima, this was disclosed to media by minister of power and parliamentary affairs and government spokesperson K.G. Kenye. He highlighted the need to address the ongoing issue of illegal liquor inflow, which posed serious health risks, particularly to the youth. The Minister stressed on the importance of aligning the state’s Christian values with contemporary societal realities.
Enforcing the NLTP Act 1989 requires huge funds while, according to speculations the state loses substantial excise revenue anywhere from Rs.100 – to Rs.200 crore annually. It is also speculated that huge amount is earned by Karbi Anglong/Assam as excise revenue due to purchases made by customers from Dimapur/Nagaland.
In Dimapur the rate in the blackmarket is understandably exorbitant since the sellers are to pay syndicates and “enforcers”. It may be recalled that the Naga Council Dimapur (NCD) had written to the state government on August 30, 2023 requesting complete lifting of the NLTP Act from Dimapur by citing several reasons, with a particular focus on negative aspects of the Act on society.
Excise bonanza
Correspondent: According to official reports, the government of Assam collected Rs 3,816 crore in revenue from liquor outlets in 2023-2024. The state’s Excise Minister Parimal Suklabaidya recently informed the assembly that the state earned over Rs 10 crore in excise revenue per day. The Assam excise department has fixed a target of Rs.4100 crore revenue for 2024-25.
Further, in order to enhance the earning, Assam is issuing new licenses in urban areas as per requirements and in areas near inter-state borders to prevent smuggling of liquor from across the boundary.
There are a total of 83 liquor shops in Karbi Anglong district with the highest concentration being under Bokajan sub division. Besides liquor shops the subdivision has bonded-warehouse and bottling plants and the revenue is expected to rise because the bottling plants and ware-houses keep the supply line flowing to various military and paramilitary forces stationed at various places in Nagaland.
Of the 83 liquor stores in Karbi Anglong district, 30 are concentrated along the border with Dimapur/Nagaland at Lahorijan and Khatkhati (under Bokajan subdivision). Ten stores are in the district headquarter at Diphu and 8 in Bokajan town. The district also has more than 23 bars also mostly at Lahorijan and Khatkhati. The district has been depositing increasing revenue from the sale of liquor to the government by exceeding the specified target.
Interestingly the excise revenue earned by Karbi Anglong district has been rising phenomenally. For the period 2023-24 while the government target was Rs.227.40 crore, the district crossed the target by earning Rs.349 crore.
Price decrease: Furthermore, prices of alcohol in Assam are set to decrease from September 1,2024 . In a notification issued on August 17, the Assam Excise Department has said that the move comes following a adjustment of ad-valorem taxes on various types of alcoholic beverages, including Indian-made foreign liquor, beer, wine, brandy, rum and ready-to-drink options.
This price adjustment comes after a hike in March, which was intended to boost state revenue, given the significant role of alcohol taxes in Assam’s financial structure. In the statement, the Department detailed the updated tax framework, which introduces varying ad-valorem levies and adjusted minimum price thresholds based on the type and cost of alcohol.
For instance, draught beer with up to 5% alcohol content will now face an ad-valorem levy of 0.57 times its assessed value, leading to a reduction of Rs 34 per 650ml bottle. In the spirits category, Indian-made spirits priced below Rs 360 per bottle will see a decrease of Rs 144 per 750ml bottle, resulting from an ad-valorem levy of 1.21 times the assessed value.
Luxury brands with a maximum retail price (MRP) between Rs 360 and Rs 500 will experience a price drop of Rs 166 per 750ml bottle, due to an ad-valorem levy of 1.08 times the assessed value.
Similarly, elegant brands priced between Rs 500 and Rs 700 will see a reduction of Rs 214 per 750ml bottle, with an ad-valorem levy of 1.06 times the assessed value.
The price cut is speculated to be a strategic move ahead of the festive season and in response to a decline in alcohol sales following the previous price hike. Assam, which consumes an average of 5.30 lakh litres of alcohol daily, generating Rs 10 crore in excise revenue, may see a significant impact from this reduction.