The Siddaramaiah government in Karnataka has initiated a significant overhaul of the state's liquor taxation system, proposing amendments to the Karnataka Excise (Excise Duties and Fees) Rules, 1968. A draft notification, published on April 18, 2026, introduces a new 'alcohol-in-beverage' (AIB) concept, which will redefine how alcohol content is measured and taxed across various categories like whisky, rum, beer, and wine.
New Taxation Structure Based on Alcohol Content
The primary objective behind this revised framework is to enhance state revenue. Under the current system, taxation criteria differ; however, the proposed amendments will shift the basis of liquor taxes to the actual alcohol content. This means that a uniform duty of ₹1,000 per litre of pure alcohol will be levied on distributor-level supplies, including imports from other states and countries.
Indian-made foreign liquor (IMFL), encompassing whisky, brandy, gin, and rum, will also see a revised excise duty structure tied directly to its alcohol content and the specific category of sale.
Impact on Beer Prices and Popular Brands
Beer, a widely consumed beverage, will be subject to new taxation slabs:
- For beer with up to 5% alcohol: ₹12 per bulk litre
- For beer with 5% to 8% alcohol: ₹20 per bulk litre
Consumers can anticipate a price increase of approximately ₹10-25 for a 180ml bottle across several popular liquor brands. According to media reports, estimated price revisions include:
- Original Choice: Likely to increase from ₹95 to around ₹115.
- Old Tavern (OT): Expected to rise from ₹80 to ₹100.
- Raja Whisky: Set to go from ₹70 to approximately ₹95.
- Haywards: Projected to increase from ₹100 to around ₹120.
Furthermore, the additional excise duty slabs will be adjusted based on declared price ranges, which is expected to significantly impact premium liquor segments. Separate provisions have also been included for military canteens, CAPF, and paramilitary supplies within the state, ensuring they maintain distinct treatment under the excise regime.