'Special corona fee' makes liquor 70% costlier in Delhi
What's the story
In what clearly looks like an attempt to generate more revenue, the Delhi government, run by Aam Aadmi Party, announced late last night it would be levying a special 70% "corona tax" on MRP of alcohol from Tuesday. As per the notification, alcohol buyers will have to pay 70% tax for liquor from today, a day after alcohol shops opened. Here are more details.
Backstory
Shuttered for over a month, liquor shops opened yesterday
Over a hundred alcohol shops opened in Delhi on Monday, after being shut for more than a month due the lockdown imposed to contain coronavirus' spread. Last week, the Ministry of Home Affairs announced that nationwide lockdown would be extended by two more weeks, until May 17. However, in the third bout of restrictions, standalone liquor shops, which aren't in containment areas, were opened.
Chaos
As shops opened, social distancing norms went for a toss
However, the scenes from across the nation were worrying as alcohol customers flouted social distancing norms and another MHA guideline which underlined that not more than five people should be allowed at the shops. Due to chaos and serpentine queues, officials had to close some shops. All stores in East Delhi were closed by afternoon. In some places, police resorted to lathi-charge.
Revenue
From 2019 to 2020, Delhi's April revenue witnessed sharp dip
Yesterday, Chief Minister Arvind Kejriwal held a Cabinet meeting where the idea of levying a tax on alcohol was discussed. Last week, Kejriwal, in a press conference, said the lockdown needs to end as generating money has become impossible. He pointed out that in April 2019, Delhi's revenue stood at Rs. 3,500 crore and in April 2020, the state earned just Rs. 300 crore.
Order
With government order, alcohol became dearer in Delhi
Delhi government's finance department released an order which revealed that 70% tax on MRP will be applied on "all categories of liquor sold through retail licensees for consumption off the premises". "It will be 70% of the MRP (maximum retail price). The new rates will be imposed from Tuesday morning," the government told. This move will boost revenues, officials in the know said.
Details
Delhi gets Rs. 5,000 crore revenue from alcohol sales
This means a bottle whose MRP is Rs. 1,000 will cost Rs. 1,700 to the buyer. To note, the Delhi government sells liquors through four of its state-run agencies, namely DTTDC, DSIDC, DSCSC, and DCCWS. The sale of alcohol generates an approximate revenue of Rs. 5,000 crore for the government. Meanwhile, the number of COVID-19 infections in Delhi stands at 4,898. 64 have died.