Kerala government pushes tax cut on low‑alcohol drinks, faces political backlash

The Kerala government has placed a proposal in its draft Finance Bill to halve the excise duty on low‑alcohol beverages, cutting the tax rate from 251 percent to 121 percent. The measure will be presented to the state assembly on July 1 and will require separate approval from the Excise Department before any new product can be sold.

The proposal has triggered criticism from opposition parties, including a BJP MP who called it "the darkest spot in the history of Congress" and warned it would encourage youth drinking. Senior Congress figure V. M. Sudheeran and religious groups have also demanded the removal of the tax concession, arguing it contradicts the state's policy of discouraging alcohol consumption. The ruling coalition’s ally, the Indian Union Muslim League, has openly opposed the cut, while the chief minister plans meetings with coalition partners to seek consensus.

The state government maintains the change is a rationalisation of the tax framework, not a shift in alcohol policy, and says no other tax changes are planned.