MP announces major excise reforms

The Madhya Pradesh government has announced a series of reforms in the liquor industry, focusing on digital transformation, fraud prevention, new product categories, and stricter regulations under the new excise policy.

For liquor store allocations, the state government will now use a combination of renewal, lottery, and e-tendering. The reserve price for liquor licences has been increased by 20 percent from the current base price, and renewals will only be permitted after 80 percent of the required amount is received.

The state government has mandated the implementation of POS billing and track-and-trace systems in liquor stores to enhance transparency. Foreign liquor warehouse approvals will now be automated, enabling seamless demand approvals. Smart warehouses featuring automated stacking, stock management, and mobile-based inventory management will also be introduced. Additionally, biometric e-locks will replace traditional locks in warehouses to improve security.

To prevent fraud, security deposits will now be accepted only through e-bank guarantee. Online payments have been made mandatory for liquor purchases in bars, and a multi-shop mapping system will be implemented, assigning one primary and two secondary suppliers for liquor distribution.

New liquor packaging and product categories are also being introduced. Country liquor will now be available in 180 ml tetra packs and a new 90 ml pack size. A low-alcohol (60 UP) country liquor category will be launched to offer consumers more choices.

Licensing and inspection procedures have been simplified. A one-time beer label registration fee will allow unlimited registrations. A new licence category has been introduced for restaurants selling only beer and wine. Bars and bottling units will now be inspected through mobile-based systems, and licensing procedures in select forest areas have been eased.

In a significant decision, 17 urban and rural areas have been declared sacred, leading to the closure of all liquor stores and bars. The affected cities include Ujjain, Omkareshwar, Maheshwar, Orchha, Maihar, Chitrakoot, Panna, Mandla, Mandsaur, and Amarkantak, along with gram panchayat areas like Salakanpur, Kundalpur, and Bandakpur.

To promote responsible drinking, a new category for beer, wine, and ready-to-drink (RTD) beverages has been introduced, aiming to curb excessive alcohol consumption.

The government has also tightened regulations for foreign liquor imports and sales. POS machines will now be mandatory in liquor stores to ensure better tracking. Foreign liquor warehouse supply systems will be automated and converted into smart warehouses. Additionally, foreign liquor will now be taxed based on the Ex-Distillery Price (EDP) with an ad valorem duty structure.