Finance Minister blood is on your lapel!

Spurious Liquor and death therefrom is seasonal ritual in India. Every year or next, a tragedy or the other happens at one place or another. Causes for such recurrent tragedy are apparent policy failure and it is unlikely to be corrected under present Hindu myopia. Earlier the reason was apathy towards poor. Mere change of reason without change of policy. Bihar is the recent State which has prohibited liquor altogether. Therefore Bihar would be the next State from where next tragedy will occur.

The real reasons for such tragedies:

Confiscatory taxation:

In principle the tax should be reasonable. It can not be confiscatory. But in practice Courts in India have never struck down any tax as confiscatory. Income tax upto the rate of 90% went unscathed during the regime of Indira Gandhi. In this background the Excise duty on liquor levied to the extent of 100% and more is also surviving. Furthermore, there is no fundamental right to do business in intoxicating drinks, as held by Supreme Court of India. Therefore Government is free to impose any amount of tax on liquor and it does impose very heavy duties. Result is that poor is forced to consume cheaper tax-free liquor made in unhygienic or even toxic conditions and fall pry to greed of seller as well as Government. The very presumption that high taxation discourages consumption is preposterous. Higher taxation leads to tax evasion.  A highly taxed regime can never be tax compliant.

Prohibition does not work.

Gujarat is one state where liquor is prohibited for decades. Why Gujarat? Because M.K. Gandhi hailed from that state and he was strictly against alcohol. However in practice all you need is a certificate from doctor that you are an addict and you will get the alcohol of your choice in Gujarat. Hotels have a separate room for Doctor where he visits every evening.  Apart from that, there is also boot legging. Place a call at right number and get the drink of your choice home delivered. But price is inclusive of tax even though vendor is not going to pay the tax to Government.

Bihar has imposed an even sterner version of prohibition. There are no exceptions. An addict has to undergo treatment with alternate medicine but no liquor. That is why there is more chances of illicit liquor and a tragedy arising therefrom. The day it happens, Will Chief Minister step down to accept responsibility for lives of people?

I don’t think so.

This complete silence of media and all on liquor ban in Bihar smells brewing liquor. The kind of law and order situation, Bihar always had, it would be no surprise that such operations are under way in every town or village with the connivance rather blessings of local police. I can only wonder.

People love to escape

Life never delivers what is expected. Unless one can live without any expectation at all, life becomes a misery. Who won’t want an escape from misery. All our so called entertainments are nothing but escape from ourselves. Alcohol is one such escape. At least believed to be. Take away alcohol and they will find marijuana or something else. Creativeness of a person in desire of escape knows no boundaries. Government can not force people not to escape. A society can be raised which may exist on co-operation and giving rather than expecting but until that utopia arises people with find some way to get high.

Will GST change it?

Governments may come and go but cost of living and taxes rarely go down. That is a universal truth. More so in India. The tax regime for liquor is unlikely to change after GST rolls out on 1st July, 2017. But Government must consider this aspect of rationalizing the liquor taxation by leaving behind romantic notion that higher tax discourages consumption. Higher tax discourages tax compliance and quality of product.