In a major shift from a 6-decade-old system, Karnataka from April 2026 is set to stop fixing retail prices of alcoholic beverages, allowing manufacturers greater freedom to set prices in one of India’s largest alcohol markets. Announcing it during the 2026-27 state budget on Friday, Chief Minister Siddaramaiah said the government will also introduce an alcohol-in-beverage (AIB) based excise duty structure, linking taxes directly to the alcohol content in drinks.
“Excise duty will be linked to the alcohol content in beverages by introducing an alcohol-in-beverage-based taxation system,” Siddaramaiah said in his budget speech.
Under the proposed system, the government plans to deregulate liquor price fixation, allowing manufacturers to decide product prices instead of seeking approval from the state. The number of pricing slabs will also be reduced to eight from the existing 16, the chief minister said.
Related News |
“Government-administered price fixation will be deregulated and the number of price slabs will be rationalised,” the chief minister added. At present, the state follows a controlled pricing structure in which manufacturers declare ex-factory prices, after which the government determines the final retail price.
Siddaramaiah Alleges Injustice by Centre
Presenting his record 17th budget on Friday, Karnataka Chief Minister Siddaramaiah said, by not adhering to the federal system of governance as per the constitution, the Centre is doing injustice to Karnataka. He also said that the state government is pursuing a development strategy that balances welfare programmes with investments in infrastructure and long-term economic transformation, while urging the Union government to be more sensitive to the state’s demands.
Related News |
Karnataka to Ban Social Media for Children Under 16 — CM Siddaramaiah’s Big Proposal in State Budget
Presenting the budget for 2026-27, Siddaramaiah said Karnataka remains at the forefront of the nation’s development and is among the largest contributors of tax revenues to the country. “Our state is at the forefront in all sectors of the nation’s development; it is one of the key states that contributes the highest tax revenues,” he said. Total expenditure for 2026-27 is estimated at Rs 4,48,004 crore, Siddaramaiah said.
