There is growing opposition among liquor traders across the state against the new bar policy of the AP government. They are threatening that they cannot do business with the rules being imposed by the government. The traders have basically decided not to apply for a bar at all.
In the last four days, traders have held meetings in all the joint districts except three districts and decided that even if any new entrants come, none of them should apply. The traders are mainly opposing the issue of collecting 15 percent additional retail excise tax (ARET) on the issue price.
The new bar policy stipulates that at least 4 applications must be submitted for each bar. With this, those who want to get a bar license must submit 4 applications. The fee is Rs. 5 lakh for each application. However, the application fee will not be refunded whether the license is received or not.
With this, those who want to get a license have to spend Rs. 20 lakh and submit applications under different names. On the other hand, this government is continuing the ARET imposed by the previous government on liquor sold to bars. When the government revised taxes, a provision was made to pay an additional 15 percent ARET. Licensees say that due to this, they are paying an average of Rs. 40 lakhs extra per year. They have asked for it to be removed.
The government estimates that if the ARET is removed, the revenue will decrease by Rs. 240 crore per year. Along with these decisions, on the other hand, the license fees have been increased drastically. In the policy given in 2022, the maximum fee was Rs. 50 lakhs, but now it has been increased to Rs. 75 lakhs. At that time, it was conducted through auction, but now it will be allocated through lottery.
Even though the auction was conducted at that time, no one, except for 10 percent of bars, sold more than the minimum price. Now, with the government increasing the fee by Rs. 25 lakhs at once, traders say that it will become a burden. Traders feel that it is unnecessary to obtain a bar license in this adverse environment.
The recent permission to set up permit rooms in liquor shops will also have a negative impact on bars. On the other hand, even if a bar license is obtained, a new license has to be obtained every three years. In fact, bar licenses have been renewed only for about half a year before 2022.