Govt mulls deducting turnover tax of bars, beer-wine parlours
Thiruvananthapuram: The government is planning to reduce the turnover tax of bars and beer-wine parlours in the state. The recommendation to deduct the tax from 10 percent to 5 percent is under consideration of the government.
Though sale of liquor and beer in bottles was allowed, the bar owners complained that there is no increase in their income. So the government decided to deduct the tax. The bar owners had to pay 10 percent of the income from the sale. This amount is likely to be cut into half.
The bars and beer-wine parlours which remained closed during the lockdown reopened by the end of May. They get 20 percent profit when liquor and beer are sold in bottles. Only maximum retail price marked in the bottle can be charged from customers.
Meanwhile, the profit earned through retail sale in bars had increased to 40-80 percent. The bar owners had permission to increase liquor price on the basis of the facilities arranged in the bar rooms. The turnover tax was fixed as 10 percent considering this profit too.
The bars are supplied liquor from the warehouse of the Beverages Corporation. The corporation pay 5 percent of the warehouse sales as income tax to the government. Five percent income tax is collected from Beverages and Consumerfed outlets which buy liquor from BevCo. But levying 10 percent tax from the bars which also sells in the same way cannot be justified, the bar owners opined.
The government collect Rs 30 lakh from the bars as annual license fee. Though the sales was affected during lockdown, no relaxation was offered in the license fee. Apart from this, the government also charges Rs 2 lakh for service desk and other facilities. The deduction in turnover tax is being planned considering all these factors.