Liquor shops in Karnataka to shut amid fare hike

Karnataka’s liquor industry is bracing for a major disruption as thousands of distilleries and liquor shops across the state plan to go on strike on May 20, followed by a complete shutdown on May 21. The protest comes in response to steep hikes in excise duties and licence fees announced in a recent government notification. The Karnataka Wine Merchants Association, in coordination with the National Restaurant Association of India and the Karnataka Brewery and Distilleries Association, is spearheading the protest. The notification, issued on May 15, doubles annual licence fees—raising brewery licences from Rs 27 lakh to Rs 54 lakh, and distillery/warehouse licences from Rs 45 lakh to Rs 90 lakh. These changes take effect from July 1.

Of Karnataka’s 12,000 licensed liquor outlets, over 5,000 have confirmed participation in the shutdown. Store owners will also halt liquor purchases from government depots as a symbolic gesture. Industry bodies warn that frequent and steep fee hikes are unsustainable, especially for small outlets. Nearly 30,000 objection letters have been submitted by licensees, vendors, employees, and customers. Over 40 pubs in Bengaluru reportedly shut down last year due to rising operational costs and declining customer footfall.

The government justified the increase by citing a revenue shortfall. While the 2024–25 excise revenue target was Rs 38,525 crore, only Rs 35,530 crore was collected, prompting a 92.3% achievement. Sampath Kumar of the Karnataka Wine Merchants Association said, “Both merchants and consumers are reeling under pressure.” Ananth Narayana of NRAI added, “We’re being pushed to the brink despite generating significant employment and tax revenue.”