The Karnataka government has proposed a shift to a duty system based on alcohol content percentage, aiming to modernise the state's excise framework.
Chief Minister Siddaramaiah presented the state budget, introducing the Alcohol-in-Beverage (AIB) excise duty structure, which links tax rates directly to the amount of alcohol in a drink.
The new system is set to come into force in April 2026 and will be implemented gradually over three to four years to prevent market disruption.
Under the new framework, excise duty will be calculated on the alcohol content per litre rather than the total volume of the beverage.
The government also plans to simplify the pricing structure for alcoholic beverages by reducing the number of price categories from 16 to eight slabs.
The excise department has been assigned a revenue target of ₹45,000 crore for the 2026–27 financial year.
