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Licence rate hike to make liquor dear

Liquor lovers would have to keep their purse strings loose when they go to a bar for a drink or two in the new year.

The state excise department has decided to increase the licence fee of bars as well as restaurants and hotels with bars astronomically, alarming hospitality industry professionals who fear that it would hike the liquor rates.

On Thursday, excise commissioner Daya Nidan Pandey told The Telegraph that a decision had been taken and the new rates would be implemented in the new fiscal.

“Those who want to get a licence to open a bar or restaurant-cum-bar or a hotel with a bar have to pay licence fee according to the new rates,” he said, adding that the existing licences would expire by the end of this fiscal (2012-13).

Pandey added: “If and when they renew their licence, they would have to pay according to the new rates.”

A source said: “According to the new rates, five-star, four-star or three-star hotels would have pay Rs 20 lakh to renew their licence.”

At present, the renewal fee is approximately Rs 5 lakh.

Smaller hotels in the municipality area would have to pay Rs 16 lakh instead of the current Rs 4 lakh. Those outside the municipality area would have to cough up Rs 8 lakh instead of the current Rs 3.5 lakh.

The new rates have made hotel employees and owners anxious. They claim that hotels, restaurants and bars would have to increase the price of the liquor they serve.

A representative of the finance section of Gargee Grand, located in the Exhibition Road area, said: “We have not received any formal direction in this regard till now but if the new rates are implemented we would have to increase the liquor prices.”

The hotel claims to have five-star facilities. The employee added: “There is no other way out. We shall not increase the room tariff but the prices of liquor would surely shoot north.”

Employees of hotel Chanakya — a four-star facility — were also of the same opinion. “The prices of liquor served in the bar will increase,” said the general-manager of the hotel, T.K. Sinha.

He added: “We have heard about the directive but a formal order has not been given to us yet. It seems that the government wants to control the consumption of liquor. Hence, it is coming with these norms.”

Sinha added that the revenue earned by the government from the hospitality sector would also increase.

The smaller bars and hotels serving liquor, however, said they were in for harder days. “We might be forced to shut down our businesses,” said the owner of a bar near Hartali Mor.

He added: “The state government should think about what it is doing. Increasing the licence fee like this doesn’t make any sense. It seems the government is determined to increase its revenue from liquor but it is forgetting the fact that our business will be affected badly.”

In 2005-06 the excise department earned Rs 329 crore. Last fiscal, the amount increased to Rs 2,045 crore.

However, the number of liquor shops had decreased from 5,733 in 2011 to 5,624 this year. The state government had announced that it would not allow the number of liquor shops to increase.

A distraught bar owner said: “The government is doing nothing to control the sale of spurious hooch. But it is set to destroy our business.”