Even as the UT excise and taxation department begins consultations for the 2026–27 Excise Policy, liquor contractors in Chandigarh say they are facing steep financial losses, with many struggling to pay their licence fees. On average, 10–12 liquor vends are being sealed every month for non-payment of mandatory fees, highlighting deep distress in the sector.
The department is inviting suggestions for the upcoming policy until December 30, focusing on revenue maximisation and ease of doing business. Proposals on the table include digitising quota conversion, strengthening the Trace and Track system, and revising advance fee and bank guarantee norms. Stakeholders have further recommended rationalising duty and VAT with Punjab and allowing extended sale hours for specific categories. The new policy will take effect on April 1, 2026.
Contractors argue that current liquor quotas are impractical and exceed market demand. The quota for country-made liquor is 20 lakh proof litres (4.45 lakh cases), for foreign liquor 8 lakh proof litres (1.18 lakh cases), and for IMFL 1.17 crore proof litres (17.4 lakh cases) annually.
They also claim that liquor prices in Chandigarh are similar to those in Mohali and Panchkula—and often cheaper across border points—leading customers to prefer neighbouring markets.
The licence fee for a vend ranges from ₹2 crore to ₹13 crore depending on its location. Contractors pay 10% upfront at auction and the remaining 90% in nine instalments, due by December 31.
Price competition hits sales
Darshan Singh Kler, president of the Wine Contractors’ Association, said the industry is reeling under pressure. “We are running into losses because rates are the same in Mohali and Panchkula, and in some border areas, prices there are even lower. A single group bidding exorbitantly high amounts during auctions has also destabilised the market. Most sealed vends belong to that group,” he said.
He added that contractors hope the 2026–27 policy will introduce structural reforms, realistic quotas, and competitive pricing to prevent repeated losses and closures.
16 vends sealed for non-payment
A senior excise official reported that revenue collection this year, up to November 30, has reached ₹693 crore, up from ₹579 crore during the same period last year—an increase of 19.69%. Currently, 16 liquor vends have been sealed for non-payment of licence fees.
In the March auction, 92 of 97 vends were sold, leaving five unsold. The UT had already lowered its revenue target from ₹1,000 crore in 2024–25 to ₹800 crore for 2025–26. Last year, it collected only ₹743 crore, significantly short of the target.
Under the 2025–26 policy, the Chandigarh Industrial and Tourism Development Corporation Limited (CITCO) was to operate any unsold vends. However, CITCO declined, leaving those vends without an operator.
