CHANDIGARH: In a major move to double the state’s excise earnings within five years, the Punjab Cabinet, chaired by Chief Minister Bhagwant Mann, approved the New Excise Policy for 2026–27 on Monday. The policy sets an ambitious revenue target of ₹12,800 crore, a sharp increase from the ₹6,255 crore collected during the 2021–22 fiscal year.
Finance and Excise Minister Harpal Singh Cheema stated that the revamped framework focuses on dismantling the liquor mafia while introducing systemic reforms to ensure transparency and ease of doing business. The government intends to use these record collections to fund public welfare projects, including schools and hospitals.
Key Reforms and Licensing Changes
The new policy introduces several structural shifts for liquor contractors and retailers:
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Renewal Framework: Existing liquor groups are eligible for renewal with a 6.5% increase in their fees.
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E-Tendering Process: Groups that do not opt for renewal will be allocated through a competitive e-tendering process, maintaining the transition away from the traditional “draw of lots” system to ensure fair market competition.
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Pricing and Quotas: The quota for country liquor (PML) has been increased by 3%, though its excise duty remains unchanged to protect affordability for common consumers. However, the excise duty on English liquor (IMFL) and beer has been increased, alongside a roughly 10% hike in license fees.
Boost for “Made in Punjab” Single Malts
In a first-of-its-kind industrial shift, the Cabinet has introduced specific rules to permit the establishment of malt manufacturing (single malt) units within Punjab.
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End-to-End Production: These units will now be allowed to conduct both distillation and bottling within state borders.
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Industrial Strategy: The move is designed to attract high-value investment and position Punjab as a significant player in the premium global liquor segment, leveraging the state’s agricultural strength in grain production.
Enforcement and Revenue Growth
Minister Cheema highlighted the success of previous reforms, noting that excise revenue had already climbed from ₹6,100 crore under previous regimes to a projected ₹11,300 crore by the end of the current 2025–26 fiscal. To sustain this momentum, the government is intensifying its crackdown on smuggling and illicit liquor, with over 26,000 raids conducted and 4,400 FIRs registered recently.
The Cabinet also approved a significant hike in reward amounts for police officials—up to ₹2 lakh for top-tier achievements—to further incentivize the dismantling of drug and liquor trafficking networks.
