The Chhattisgarh government has decided to completely abolish Value Added Tax (VAT) on liquor. Until now, an 8.5 percent VAT was charged on alcoholic beverages, but the Commercial Tax Department has issued a notification removing it. The new rule will come into effect from April 1, 2026.
According to government officials, liquor sales in Chhattisgarh are entirely under government control and are managed by the Chhattisgarh State Marketing Corporation Limited. Earlier, this government-run body itself had to pay VAT on liquor sales, which was considered impractical. This is why the decision to remove VAT was taken.
However, the government has clarified that removing VAT will not lead to a reduction in liquor prices, as excise duty will continue to remain in force.
At the same time, the state government has approved a new excise policy. It is worth noting that an additional 9.5 percent excise duty on foreign liquor had already been removed earlier. The government says these changes will simplify the tax system and make administrative processes more efficient.
