Kochi: Liquor costs 10 times its purchase price

KOCHI: The answer given by the Public Information Officer of Kerala State Beverages Corporation Ltd (KSBC) to an RTI applicant gone viral on the social media on Sunday reveals the extraordinary interest on anything related with alcohol in the state.

The RTI application was concerning a simple question of the purchase price of the alcohol by the KSBC and its sales price. It should be remembered that the state government agency is the only authorised entity for wholesale and retail sales of alcoholic spirits, including beer and wine in the state.

The tipplers in the state, having the reputation of one of the highest per capita consumption of alcohol, was surprised to find that the state government agency on average charges the consumer more than ten times higher for a bottle than its purchase price.

A bottle of 750 ml costing Rs 71.60 for KSBC is sold at Rs 770 for the consumer with the agency gaining a margin of over Rs 700 per bottle. The same applies to popular brands of whiskey and brandy.

The price list given as per the RTI request has unleashed the wrath of tipplers across the state. One irate drinker in a WhatsApp message has called upon fellow beings to share the price list until this “looting” is brought to an end. The government, however, is unlikely to be persuaded by the lamentations of the lovers of alcohol as duties and levies from alcohol remain one of the primary sources of revenues for the cash-strapped state exchequer.

In the financial year, 2018-19 the KSBC and Consumerfed together earned sales turnover of Rs 14,508 crore compared with Rs 11,000 crore in the previous year. The average selling price remaining ten times higher than the purchase price the government would be earning more than Rs 10,000 crore from sales.

The duties and levies for liquor in the state around 220 per cent, one of the highest in the country, is largely in tune with the global trend of keeping taxes for alcoholic beverages at a higher level to check alcoholic abuses. A report by the World Health Organization as early as 2004 titled “What are the most effective and cost-effective interventions in alcohol control’ has identified higher taxes as one of the measures to keep drinking levels down.

The report mainly concerning Europe has stated that “the effects of changes in alcohol prices have been extensively studied, most commonly by econometric methods.

There are, however, also panel studies, observational studies and analyses of major changes in alcohol prices. Almost all of the econometric studies have shown that a rise in the price of alcoholic beverages leads to a fall in alcohol consumption, and a decrease in prices generally leads to a rise in alcohol consumption. This has been shown both with regard to total alcohol consumption and the consumption of different beverage categories”.

The higher price of alcohol has also been justified on the grounds of the public health concerns associated with the high levels of alcohol consumption. The above mentioned WHO report states that “alcohol consumption is associated with several somatic problems, such as liver cirrhosis, certain cancers, elevated blood pressure, stroke and congenital malfunctions.

Heavy intoxication is related to several other kinds of problems, such as violence or accidental death. Furthermore, alcohol consumption increases the risk of many families, work and social problems such as financial hardship, absenteeism, poor productivity and criminal behaviour. In Europe, alcohol consumption is estimated to be responsible for about 10 per cent of the total disease burden”.

The situation in Kerala is also unlikely to be different from the experience of Europe mentioned by the WHO report. Unfortunately, we are not having any reliable data on the public health hazards caused by alcohol consumption in the state.

According to a study published in International Journal of Community Medicine and Public Health published in 2017 titled A Community Study of Alcohol Consumption in a rural area of South India by Rajeev A. and five others of the department of community medicine Pushpagiri Institute of Medical has stated that poor and lesser educated sections of the society in Kerala are the worst hit by alcohol abuse.  

Alcohol is reaping a socio-psychological cost from the lesser educated and poor of Kerala. Its prevalence varies from 33-50%, with the age of initiation decreasing recently. The type of liquor and how it is consumed make it a risk factor for many health hazards, the study stated.

The successive governments in the state, unfortunately, have completely neglected the public health hazards linked with the alcohol consumption in their anxiety to use liquor as the most potent commodity for revenue maximisation. The policymakers would be compelled to take a serious look at the issue only if the people in the state decided to cut the alcoholic intake instead of lamenting over the government charging exorbitant rates for a drink.