Punjab okays new Excise Policy, eyes Rs 11,020 cr revenue next fiscal

The Punjab Government has made the serving of liquor at farmhouse parties in the state costlier by raising the licence fee for such events from Rs 25,000 to Rs 2 lakh from April 1. This change is part of the Excise Policy for 2025-26, approved by the Council of Ministers on Thursday.

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The government aims at collecting Rs 11,020 crore excise revenue next fiscal. Under the new policy, while the prices of country-made liquor (Punjab Medium Liquor) remain unchanged from last year, the cost of Indian Made Foreign Liquor (IMFL) will increase by Rs 10-15 per bottle. Beer prices are determined by market forces under Punjab’s open pricing mechanism. The prices of premium beer will range between Rs 180 and Rs 200 per bottle.

The government will continue with the open quota for IMFL sales while increasing the quota for country-made liquor by 3 per cent, setting it at 8.53 crore proof litres. Additionally, after a three-year hiatus, the cap on establishing liquor bottling plants in the state has been lifted. “We received numerous inquiries from investors interested in setting up bottling plants, and to attract investment, we have decided to allow new plants,” Excise Commissioner Varun Roojam told The Tribune. Currently, Punjab has 25 bottling plants, 17 distilleries, and four breweries.

The policy also raises the alcohol possession limit for farm stays catering to tourists. Licence holders can now possess up to 36 quarts of IMFL, up from 12 quarts, along with increased allowances for beer, wine, gin, vodka, brandy, ready-to-drink beverages and other liquor products.

Finance, Excise and Taxation Minister Harpal Cheema announced that the state was reverting to the 2022 policy of allotting liquor vends and groups (licensing units) through an e-tendering process. “Last year, we allotted vends through a draw of lots. For 2025-26, fresh allotment of L-2/L-14A retail vends will be conducted via e-tender, with group sizes set at Rs 40 crore, allowing a 25 per cent variation. A total of 207 groups will be auctioned. This will help balance the existing retail trade and ensure better and widespread participation,” he explained.

The policy aims at boosting excise revenue by Rs 874 crore over the previous year, targeting Rs 11,020 crore for 2025-26. “When we assumed office in 2022, annual excise collections stood at Rs 6,100 crore. This fiscal year, we expect to close at Rs 10,200 crore, slightly above our target of Rs 10,145 crore,” Cheema added.