Hyderabad: The State Government has decided to increase the application fee for liquor trade licenses from Rs two lakh to Rs three lakh. This means potential wine shop dealers need to pay an extra Rs one lakh to apply for the auction covering the period from 2025 to 2027. The State excise and prohibition department aims to raise over Rs 3,000 crore from these applications in November. Previously, in 2023, the government collected Rs 2,000 crore from application sales.
Around 2,620 licensed wine shops will be auctioned through a lottery system in November. With current licenses expiring on November 30, the excise department has announced the new pricing early to complete the process by month-end. Officials mentioned that a revision of existing license fees might be included in the upcoming excise policy. They are currently assessing how the new rates could affect the liquor business, especially as wine shop owners have expressed concerns over high costs.
In Hyderabad, wine shop owners pay Rs 1.10 crore annually. Many have reported reduced profits since bars and restaurants began selling liquor at MRP prices. The government has been granting permissions for new bars and restaurants more freely in Greater Hyderabad, causing financial strain on existing outlets trying to cover the license fee.
Similar challenges exist in municipal corporation and municipalities where new bars and restaurants have also opened recently. The decision on increasing the license fee will consider the difficulties faced by current outlets.
Wine dealers are also asking for a higher retailer’s margin. Currently, they receive a 27% margin on ordinary IMFL (Indian Made Foreign Liquor), and 20% on both medium and premium IMFL, as well as on beer. All these concerns will be addressed in an upcoming meeting with excise officials, according to representatives from the Wine Dealers Association.
