Row over low-alcohol beverages: Kerala CM counters CPM, says number of bars crossed 900 under LDF

Thiruvananthapuram: Kerala Chief Minister V D Satheesan on Wednesday launched a sharp attack on the CPM while defending the government's Budget proposals on liquor taxation, accusing the previous LDF administration of promoting low-alcohol beverages and presiding over a steep rise in the number of bars in the state.

Replying to the three-day Budget debate in the Assembly, Satheesan said the United Democratic Front (UDF) government had not taken a final decision on allowing the sale of low-alcohol beverages in Kerala. He said a liquor policy would be formulated only after discussions within the coalition and consultations with stakeholders.

The chief minister's remarks came amid Opposition allegations that the government had altered tax rates to benefit liquor companies and was paving the way for the introduction of low-alcohol drinks in the state.

No final decision on low-alcohol drinks

Satheesan said the tax rates announced in the Budget should not be interpreted as a decision to permit the sale of low-alcohol beverages.

"The liquor policy is a political decision. The UDF will discuss it internally, prepare a draft, consult stakeholders and parties, and then arrive at a policy," he said.

Clarifying the government's position, he said the tax structure had only been prepared in case such beverages were eventually allowed.

"If, after those discussions, the UDF decides that low-alcohol beverages should be sold in Kerala, these would be the applicable tax rates. If the UDF decides they should not be sold, then they will not be sold. That is ultimately a political decision," he said.

Satheesan also rejected claims that the issue had bypassed discussions within the ruling alliance, saying there was a clear distinction between administrative procedures and political decision-making.

Jibe at CPM over government files

In a pointed attack on the CPM, the chief minister said routine government files would not be taken to party offices for approval.

"Routine administrative files are not taken to the party office," he said.

Satheesan said major policy decisions would be discussed through party and coalition mechanisms, including consultations with the Kerala Pradesh Congress Committee (KPCC) leadership.

"When it comes to major policy decisions, I will go to the KPCC office, discuss the matter with the party president, request the convening of the relevant committee, and formulate policy after consultations," he said.

He added that his government would not move official files outside the established administrative process.

"What we will not do is take day-to-day government files to the party office or secretly move files there for approval without the knowledge of the CM. That is not how this government functions," he said.

Defends tax structure, rejects favouritism charge

The chief minister also defended the Budget's tax proposals, saying they did not involve any reduction in taxes as alleged by the Opposition.

According to Satheesan, the government fixed a tax rate of 175 per cent on beverages containing between 10 and 20 per cent alcohol.

"We did not adopt a rate between 86 per cent and 116 per cent as suggested. Instead, for beverages containing between 10 per cent and 20 per cent alcohol, we fixed the tax at 175 per cent," he said.

He described it as one of the highest tax rates imposed on such beverages by any Indian state and argued that allegations of favouring liquor manufacturers were politically motivated.

Turns spotlight on previous LDF government

Satheesan sought to shift the focus onto decisions taken by the previous LDF administration, saying discussions on permitting low-alcohol beverages had begun during its tenure.

Referring to corruption allegations raised by the Opposition, he said critics were questioning whether the government had received benefits from liquor companies.

"People ask, 'How much did you receive?' Let me explain from the beginning," he said.

The chief minister said applications submitted by liquor companies had been considered by the previous government and questioned who had initiated discussions with the industry.

"So I ask: Who first held discussions with liquor companies? Who initiated those talks?" he said.

He further claimed that the LDF government's liquor policy for 2022-23, based on the recommendations of the Udayabhanu Commission, had proposed promoting beverages containing up to 20 per cent alcohol.

Claims bar numbers rose from 28 to over 900

Escalating his attack on the CPM, Satheesan accused the previous government of facilitating a dramatic increase in the number of bars operating in Kerala.

According to him, the number of bars rose from 28 in 2016, when the Pinarayi Vijayan government assumed office, to more than 900 at present.

"The very government that now claims low-alcohol drinks are dangerous had a liquor policy promoting them," he said.

Satheesan also questioned tax decisions taken by the previous administration on imported foreign liquor.

"Was that lower tax granted because someone accepted favours from imported foreign liquor brands? That is the question being raised," he said.

The chief minister maintained that the decision to create a separate category for low-alcohol beverages had been taken by the previous government and that the present administration had only determined the tax structure applicable to that category.