Nitish Kumar to forego Rs 4,000 crore revenue for liquor ban



Though Bihar chief minister Nitish Kumar announced prohibition from 1 April, 2016, but the decision will cost the state around Rs 4,000 crore in revenues every year.

The move follows a promise Kumar had made in July in the middle of the Assembly poll campaign. “I will not step back from what I had said… and I will implement it. The new policy of prohibition would be a law from 1 April, 2016.”

The decision also found support from a political rival. “We support total prohibition in Bihar. Country liquor as well as foreign liquor should be part of this ban,” tweeted Sushil Kumar Modi, senior BJP leader who was deputy chief minister till 2013.

“I know there would be a loss of revenue. We have to face problems for two to three years. However, I will adjust the loss. Poor families are being destroyed by liquor, I can understand the pain of women,” he said.

It may be noted women, who outnumbered men in voting in the recent elections, are among Kumar’s biggest supporters.

In ordering prohibition, Kumar has taken a 180-degree turn. Soon after coming to power first in 2005, he took steps to increase excise revenue.

In the 2010 assembly polls, then political foe Lalu Prasad had made liquor a political issue and alleged that Kumar, alleging at every rally that Nitish had introduced liquor across Bihar.

If there were 3,000 liquor vends when Kumar took over as CM in 2005, the number rose to 6,000 today.

In 2005, Bihar generated Rs 295 crore of revenue from liquor sales, which is likely to touch Rs 4,000 crore in 2015-16. Excise tax, a chunk of which comes from liquor, makes up 15% of the total revenues that stand at Rs 30,875 crore for 2015-16.”

At present, Gujarat, Nagaland, Manipur and UT of Lakshadweep have total prohibition, while in Kerala, bars are allowed only in five-star hotels.


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