INDIA: SWA chief attacks "Byzantine" alcohol duty structure in India

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The chief executive of the Scotch Whisky Association has called for a more rational tax structure in India, attacking the country for its "Byzantine" state tax systems.

Speaking late last week at the IndSpirit drinks conference in Mumbai, Gavin Hewitt said that a rationalisation of excise duties across India's states "could bring considerable benefits for state governments, industry and consumers".

The SWA has long lobbied for harmonisation of taxes on imported spirits across India, where some states are charging as much as 550% in tax on foreign alcoholic beverages .

"I recognise that excise duty represents a very high percentage of state tax revenues in India," Hewitt told delegates at the conference on Friday (14 November). "But the vagaries of those state tax systems are Byzantine.

"A more rational tax structure might play neatly into the Federal Government's wish to see greater harmonisation of tax on alcohol at state level, matching the progress that has already been made in the VAT field. We believe that progress in these areas would bring additional revenue to state finances, create a transparent and fair playing field for all producers, and ensure consumers have a full choice of international and domestic brands at affordable prices."

Hewitt's comments echoed the sentiment of the president and managing director of United Spirits, Vijay Rekhi, earlier at the conference. Rekhi said in his speech to delegates: "In total, there are 119 different types of taxes on beverage alcohol across the country. There has to be a rationality in thinking.

"Where is the earthly sense in higher taxation of alcohol in one state compared to a lower rate in a neighbouring state? There needs to be a national consensus in policy."

Sectors: Spirits

Companies: Scotch Whisky Association

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