Daijiworld Media Network - Thiruvananthapuram

Thiruvananthapuram, Jul 1: Kerala Chief Minister V D Satheesan on Wednesday defended the UDF government’s decision to reduce taxes on low-alcohol beverages, while clarifying that the move does not automatically mean permission for their sale in the state.

The Kerala Assembly later passed the Finance Bill, approving the tax proposals announced in the state Budget, after the opposition staged a walkout alleging that the Bill was aimed at facilitating the sale of low-alcohol beverages.

Addressing the Assembly, Satheesan said the tax proposal should not be interpreted as a decision to introduce such beverages in Kerala. He said any decision on allowing their sale would be taken separately as part of the UDF government’s liquor policy after detailed public consultations.

The Chief Minister said if the government decides against introducing low-alcohol beverages, they will not be sold in the state. He also rejected the opposition’s argument that notifying the tax rate would automatically lead to their sale.

Satheesan explained that the Kerala State Beverages Corporation, which has a wholesale monopoly over liquor distribution, would not procure such products if the government decides not to permit their introduction.

Accusing the opposition of politicising the issue, the Chief Minister said the tax proposal was part of the Budget and not a new provision added through the Finance Bill. He said incorporating Budget tax proposals into the Finance Bill was a normal legislative process.

He said the proposal was not a fresh initiative and claimed that a related file had originated on November 16, 2021, during the previous LDF government’s tenure.

Satheesan said recommendations by the A P Udayabhanu Commission and the Justice Ramachandran Committee had supported promoting low-alcohol beverages as a way to reduce dependence on hard liquor and encourage de-addiction.

He said the government was only creating a separate tax category for beverages containing up to 20% alcohol, while Indian Made Foreign Liquor currently sold in Kerala contains 42.86% alcohol.

The Chief Minister said Kerala imposes the highest taxes among southern states on low-alcohol beverages and referred to World Health Organisation recommendations favouring lower-alcohol products over stronger liquor.

He also announced that 541 projects across various departments would be completed within the next 100 days under a time-bound implementation plan.

The Assembly was later adjourned sine die.

The tax proposal has faced criticism from opposition parties as well as sections within the ruling UDF. Senior Congress leader V M Sudheeran has opposed the move, while ally Indian Union Muslim League has also raised concerns.

The government has reiterated that a final decision on introducing low-alcohol beverages will be taken only after wider consultations as part of the state’s liquor policy.