The Karnataka State Excise Department has implemented a new Alcohol-in-Beverage (AIB) based excise duty structure, becoming the first state in India to do so, and has published revised Maximum Retail Prices (MRP) for liquor and beer.
The change, announced by the Chief Minister during the 2026-27 Budget speech, was formalized through Notification No. FD 14 PES 2026 issued on May 8, 2026, amending the Karnataka Excise (Excise Duties and Fees) Rules, 1968. The new rules took effect on May 11, 2026, introducing rationalized prices across various liquor and beer products.
The revised MRPs apply to products manufactured after May 11, 2026. The AIB structure removes government-administered price fixation by allowing producers to position their products within specified pricing slabs based on market factors and alcohol content.
In a letter dated May 16, 2026, to the Commissioner of the Department of Information and Public Relations, the Excise Commissioner’s office emphasized the need for public awareness regarding the new pricing scheme. It requested the immediate publication of the revised MRP list for popular liquor and beer brands, including prices and sizes, in major Kannada and English newspapers across the state.
This move represents a historic shift towards deregulation in the Indian liquor industry, seeking to balance market-driven pricing freedom for producers with price slabs designed to rationalize consumer costs.
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