Water, foreign liquor, tobacco products, government services to cost more in Kerala

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Thiruvananthapuram, Sept 18: The Kerala government is on a 'reform spree'. To tackle the financial crisis the state is caught up in, the government on Thursday decided to raise tax on Indian-made foreign liquor (IMFL), including beer and wine.

The duty on IMFL will now be 135%. The government aims to generate an additional Rs 1130 Crore income by raising the tax for IMFL. The existing sales tax on foreign liquor is 115 per cent.

Kerala charges one of the highest tax rates on IMFL in India. It collects around Rs 7,500-8,000 crore annually from sale of IMFL at the Kerala State Beverages Corporation (Bevco) and Kerala State Co-operative Consumers Federation outlets.

The government accepting most of the recommendations of the report submitted by additional chief secretary KM Abraham, said a Business Standard report.

Apart from this, the Cabinet meeting decided to raise tax on cigarettes and other tobacco-laden products. Tax for them would be 30 per cent, as against the existing 22 per cent.

Additional cess from the sale of foreign spirits would be used to rehabilitate employees of bar hotels and beverages outlets which have been closed down.

The state government led by Oommen Chandy hasn't spared even drinking water from tax hike. Tax on piped drinking water has been raised by 50 per cent more in the state, which means citizens will now have to pay Rs 6 per kilolitre water, instead of the current rate Rs 4.

The fee for government services in the range of 10-1000 has been raised by 50 per cent in Kerala. For services charged in the range of Rs 1,000-2000, the increase is 25 per cent and it is 15 per cent more for fee above Rs 10,000, said the BS report.

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