Karnataka to tax alcohol based on its strength
Starting April 2026, Karnataka will become the first state in India to tax alcohol based on its alcohol content instead of price.
Announced by Chief Minister Siddaramaiah, the new Alcohol-in-Beverage (AIB) tax means distillers get to set their own categories, and the state hopes it will boost revenue while tackling some of the downsides of alcohol use.
Current tax slabs and expected changes
Right now, there are 16 different tax slabs based on how much a drink costs, but that's about to change.
The plan is to cut this down to eight slabs by 2026-27 and eventually remove them altogether.
This shift should make things fairer: whether you're buying a budget bottle or something fancy like Blue Label, drinks with the same alcohol strength will be taxed equally.
Officials also expect these changes could mean more sales and extra money for the state's budget.