Trying to save jobs, not circumvent SC order on liquor ban: Siddaramaiah
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Bengaluru: Karnataka chief minister Siddaramaiah on Thursday said that the state government did not intend to circumvent the 1 April Supreme Court (SC) order to ban sale of liquor within 500 metres of state and national highways.
Speaking in the state legislative council on Thursday, Siddaramaiah said that Wednesday’s cabinet nod to denotify many roads near towns and cities and handing it over to urban local bodies was for better maintenance and not circumvent the SC order as alleged by members of the Bharatiya Janata Party (BJP).
His statement comes at a time when the state government is trying to insulate itself from the estimated revenue losses on account of the rolling out of the Goods and Services Tax (GST) but more importantly keep the revenue inflow from the high earning excise department intact.
Siddaramaiah said the de-notification’s aim was not just to save liquor shops but to save the thousands of jobs associated with them.
The state government has issued notices for liquor stores along highways to close down before 30 June. Karnataka, among many other states, has also filed a review petition in the matter.
Siddaramaiah said a total liquor bank will not be feasible in Karnataka.
Liquor generated revenues of Rs15,332.8 crore for Karnataka in 2015-16—up 11.10% from the preceding year and higher than the state’s target of Rs15,200 crore, according to state excise department data. But a drought in Karnataka has led to a dip in sales this year and revenue for 2016-17 is unlikely to meet the Rs16,510-crore target, since it stood at Rs14,608.27 crore as of 25 February.
The state has around 10,097 liquor outlets operating under various categories of licences, including retail stores, clubs and restaurants, of which around 6000 are expected to be impacted due to the Supreme Court ban, according to a state excise department official who requested anonymity.
The state government has so far argued that the number of accident deaths due to alcohol is not as alarming as made out to be. Karnataka accounted for 9.4%, or 44,011 cases, of the total 4,64,674 road accident cases in 2015 that left 4,82,389 persons injured and 1,48,707 dead, according to a 2015 report by the National Crime Records Bureau.
A case-wise analysis of road accidents in 53 mega cities revealed that a majority of them were due to dangerous/over taking/careless driving. Driving under influence of drugs/alcohol caused 2% (348 out of 17,059 deaths) of fatalities in road accidents. Chennai accounted for 93 out of the 348 deaths in this category, according to NCRB data.
But the ban is expected to hit the business of larger establishments as well.
According to an April report by research firm Crisil Ltd, 25-30% of premium segment hotels will bear the brunt of the ban, with the most significant hit on hotels in Pune, Kolkata and Agra. Liquor sales account for about 10-30% share of the total food and beverage revenue. This forms about 5-15% of overall revenues and varies property-wise, analysts at Crisil added in the note.