Karnataka Govt Slashes Beer, Whiskey Prices By Up To 25% Check New Rates Under Alcohol- Content-Based Excise Policy

(MENAFN- Live Mint) The Karnataka government's Excise Department has recently announced reductions of at least 20–25 per cent in the prices of mild and lager beers, effective 11 May. The new price list has been rolled out under the Alcohol in Beverage (AiB) policy for beers and spirits.

Media reports on Friday stated that under the AiB policy, the maximum retail price (MRP) of beers with 5 per cent alcohol v/v has dropped by 20–25 per cent.

Starting 11 May, the state government replaced its decades-old bulk litre-based system with a new model that calculates pricing based on the percentage of alcohol in beverages. According to a report in Deccan Herald, Karnataka has become the first state in the country to adopt this model.

Also Read | Bahamas alcohol ban: Why is liquor banned at Royal Caribbean's CocoCay on May 12

The move will have a ripple effect, making cheaper liquor more expensive while slashing the prices of premium brands by at least 20 to 25 per cent.

Here's what will change for alcohol lovers in Karnataka

According to the new price list, the MRP of 650 ml bottles of some of the most popular mild beer brands containing 5 per cent alcohol v/v, including Kingfisher Premium, Kingfisher Ultra, Budweiser, UB Export, and Heineken, has been reduced by ₹75 (KF Premium, Ultra), ₹70 (Heineken), ₹25 (UB Export), and ₹20 (Budweiser Premium).

The Excise Department has also announced a price reduction of at least 20 per cent on premium Scotch whiskies. The MRP of 750 ml bottles of Black Label (43 per cent alcohol v/v) and Chivas Regal (40 per cent alcohol v/v) has come down from ₹5,190 to ₹4,100.

Also Read | Liquor prices to change in Karnataka: States where buying booze is still costly

Additionally, prices of cheaper Indian Made Liquor (IML), especially popular 180 ml tetra packs of whiskey, rum, brandy, gin, and vodka, are set to rise by 20–30 per cent under the new Excise policy.

Premium and foreign liquor brands are likely to become cheaper. Liquor manufactured by multinational companies such as Diageo, Pernod Ricard, and United Spirits is expected to see a price reduction of 16–20 per cent.

Impact of price change on Excise slabs

The change in prices is expected to impact lower- and middle-income consumers the most.

According to The New Indian Express, the first five slabs account for 75–80 per cent of Excise revenue. The new MRP of the popular rum brand Old Monk, with 42.8 per cent alcohol v/v, has been revised from ₹765 to ₹850. Old Monk falls under the fifth Excise slab.

Also Read | Old Monk more preferred liquor brand among rich Indians, reveals Hurun report

According to media reports, officials said the additional Excise duty on products falling under slabs six to eight has been reduced by nearly 10–15 per cent, benefiting high-end liquor categories preferred largely by affluent consumers.

Final new MRP yet to be released

Citing industry experts, The New Indian Express reported, "The final new MRP list of all brands has still not been released. Though the new MRP kicked in on May 11, people are still not aware of the new pricing. We will have to wait and watch the market response."

Additionally, the Karnataka government has reduced the number of Excise slabs used to classify alcohol by MRP from 16 to 8.

On 8 May, the Chief Minister Siddaramaiah -led government issued a final notification on the new tax policy through the Karnataka Excise (Excise Duties and Fees) (2nd Amendment) Rules, 2026. Karnataka is the first state in India to introduce the AiB taxation policy. AiB refers to the alcohol content or volume per litre of liquor such as brandy, whiskey, gin, rum, beer, wine, fruit wine, and fortified wine.

Karnataka Brewers and Distillers Association raises concerns

Karnataka Brewers and Distillers Association (KBDA) has expressed concern over the sharp increase in additional Excise duty on liquor in the first five slabs. Industry representatives said the price of a quarter bottle, which was earlier around ₹63 and later rose to ₹80 after previous revisions, could now increase to nearly ₹105 under the new tax regime.

The new policy has also drawn criticism from local manufacturers and industry bodies, which argue that the taxation burden has disproportionately fallen on budget liquor that contributes nearly 70–75 per cent of Karnataka's excise revenue.

The KBDA also warned that while multinational companies may be able to absorb market fluctuations, several small and regional liquor producers dependent on low-cost products could face severe financial stress and possible closure due to falling sales.

MENAFN15052026007365015876ID1111121944