Beer lovers in Karnataka will have to shell out more money as the state government has once again raised taxes on beer. The new rules increase the overall tax on beer to 205% of its manufacturing cost, up from the earlier 195%. This includes a 10% hike in the Additional Excise Duty (AED).
This is the third time in two years that Karnataka has raised beer taxes.
As a result of this hike:
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Premium and niche beer brands could become costlier by around ₹10 per bottle.
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Mid-range and local beers may see a smaller increase, under ₹5 per bottle.
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Prices will vary depending on the brand and production costs.
The government has also scrapped the old dual tax system, which had a fixed rate for cheaper beers and a percentage-based rate for others. Now, all beer brands will be taxed at a flat 205%, regardless of type or price.
This change aims to simplify the tax structure, but it means uniformly higher prices for consumers.
To put it in context:
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In July 2023, the tax was raised from 175% to 185%.
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In January 2025, it was increased again to 195%.
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Now, in April 2025, it’s been pushed to 205%.
The base excise duty structure was also updated earlier this year to a tiered system based on alcohol content:
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₹12 per litre for beers with up to 5% alcohol.
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₹20 per litre for beers with 5–8% alcohol.
