Telangana nets over Rs 2,600cr as application fee for liquor shops

Hyderabad: In a new record of sorts, the government of Telangana has earned a revenue of Rs 2,639 crore as an application fee for the allotment of liquor shops in the state.

A total of 1,31,954 applications have been received for the 2,620 liquor shops in the state. The Excise Department earned the money without even selling a single liquor bottle. The record revenue was earned in the form of a non-refundable application fee. The liquor shops will be allotted by a draw of lots on August 21.

The Excise Department will grant licenses for operating the shops from December 1, 2023, to November 2025. Over 1.31 lakh liquor traders applied for licenses across the state. This is an all-time high number of applications since the formation of Telangana state in 2014.

During the last round of licenses in 2021, the government received 69,000 applications. It had earned Rs 1,350 crore under non-refundable application fee and Rs 3,500 crore through a shop license fee.

Under the new liquor policy 2023-25, the non-refundable fee for each application has been fixed at Rs 2 lakh. The license fee per annum per shop is in the range of Rs 50 lakh to Rs 1.1 crore depending on the population of the area. Eligible applicants have to submit 25 per cent of the amount as excise tax for one year.

The yearly special retail excise tax per annum will be Rs.5 lakh. The licenses will be issued for 2,620 shops across the state. The government has reserved 15 per cent shops for various weaker sections.

A total of 786 shops will be allotted to Gowdas, Scheduled Castes and Scheduled Tribes. Of the total shops, 615 will be allotted in Hyderabad. Under the new liquor policy, the margin for traders has been fixed at 27 per cent for ordinary category and 20 per cent for premium category and beer.

Though the current licenses are valid till November 30, the state government initiated the tender process well in advance in view of the Assembly elections due to be held in November-December. A total of 1,31,490 applications have been received. An average of 50 traders are competing for each shop. Maximum number of applications (10,908) were received for a shop in Saroornagar area of Hyderabad.

According to excise officials, 10,811 applications were submitted for a shop in Shamshabad. For a shop in Kumaram Bheem Asifabad, the lowest number of applications (976) were received.

Adilabad stands at the second lowest with 979 applications. August 18 was the last date for receiving the applications. More than 87,000 applications were received in the last two days.

Participation of several politicians, businessmen, or their representatives in the tender process is said to be the main reason for a big jump in the applications this year. The traders expect huge liquor revenues in view of the series of elections for next one year, starting with Assembly elections.

Telangana’s revenues from liquor sales have doubled from Rs 12,703 crore in 2015-16 to Rs 25,585 crore in 2021-22. This was despite the hike in prices of all forms of liquor a couple of years ago. The sales during 2022-23 were estimated to be nearly Rs 30,000 crore.