Liquor manufacturers have raised objections to the Excise Department’s decision to slash the permitted alcohol loss during production and storage from 1.5% down to just 0.1%.
According to reports, producers say the new threshold, brought in under Excise Notification No. 991 dated July 24, would in effect leave leading liquor companies — which together contribute roughly Rs. 23 billion in taxes each year — facing additional tax liabilities.
In a written submission to the Excise Department, the companies warned that the tighter limit would make it increasingly hard to sustain production operations.
The manufacturers pointed out that alcohol naturally evaporates at various stages of production, storage and bottling, including during the transfer of spirits to bottling machines, and argued that the revised allowance fails to reflect real conditions on the ground.
They further alleged that the cut from the previous 1.5% allowance set under Excise Notification No. 151 was made without any proper scientific evaluation, and called on the Department to carry out a practical, evidence-based study before enforcing the new limit.