Andhra Pradesh Notifies 2026-27 Excise Policy Retaining 3,736 Liquor Outlets

The Andhra Pradesh government has officially notified its Excise Shops Policy for the 2026-27 fiscal year, confirming the retention of 3,736 retail liquor outlets across the state. The policy, issued by Principal Secretary for Excise, Mines and Geology Mukesh Kumar Meena through GO Ms 579, establishes the regulatory framework for liquor sales from October 1, 2026, through September 30, 2027. This decision follows a comprehensive review of excise policies implemented between 2019 and 2024, alongside recommendations from the state's Group of Ministers.

Under the new notification, the state will maintain its current distribution of retail points, with 3,396 shops designated for the open category and 340 shops reserved specifically for the Geetha Kulalu toddy-tapping community. The government has opted to permit the renewal of existing retail liquor shop licences for the upcoming year, providing a structured path for current operators to continue their business under the updated regulatory requirements.

The policy outlines a specific financial structure for existing licensees seeking to renew their operations. Licensees opting for renewal are required to pay a Renewal Retail Excise Tax (RET) calculated at 38 percent of the annual RET, in addition to the standard annual RET and any applicable permit-room fees. These renewal payments must be submitted in a single lump sum alongside the first installment of the annual RET. To ensure financial compliance, licensees choosing to pay their annual RET in installments are mandated to provide a bank guarantee equivalent to one three-month installment.

For shops that are not renewed by current holders, the government will conduct an allotment process through a draw of lots. Applicants for these new slots must pay a non-refundable application fee of 3 lakh rupees, as specified in the policy, alongside the standard annual RET and permit-room fees. The policy mandates that at least four applications must be received for any shop to be considered for the draw. Newly allotted shops will not be subject to the renewal RET, as they are entering the system as fresh licenses.

The annual Retail Excise Tax for the 2026-27 period is determined by the population of the respective mandal, nagar panchayat, municipality, or municipal corporation, based on 2011 census data. For open-category shops, the annual RET is set at 60.5 lakh rupees for areas with populations up to 50,000, increasing to 71.5 lakh rupees for populations between 50,000 and 5 lakh, and reaching 93.5 lakh rupees for areas exceeding 5 lakh residents. Reserved category shops for the Geetha Kulalu community follow a proportional rate structure, set at 30.3 lakh, 35.8 lakh, and 46.8 lakh rupees respectively for the same population tiers.

Permit-room fees are also standardized across the state. For areas with populations up to 50,000, the fee is 5 lakh rupees for both open and reserved categories. In areas with populations exceeding 50,000, the permit-room fee is set at 7.5 lakh rupees regardless of the shop category. These permit-room fees may be paid in a single lump sum or in three equal installments, providing flexibility for operators managing these additional service areas.

A central feature of the 2026-27 policy is the implementation of a rigorous digital monitoring framework. The government has mandated an end-to-end Track and Trace system that covers the entire supply chain from production to final retail sale. This system is designed to integrate digital stock and sales records with e-inventory monitoring, ensuring real-time oversight of liquor movement. Licensees are required to maintain hardware and software capable of processing both cash and digital payments, reflecting a broader push toward transparent transaction records.

Physical surveillance requirements have also been tightened. Each retail shop must install four CCTV cameras covering the sales counter, stock area, consumer area, and permit-room area. These systems will be linked directly to an AI-enabled Command and Control Centre managed by the excise department. The government has warned that any deliberate tampering with these systems or disruption of the monitoring feed will result in severe penalties, with repeated violations potentially leading to the permanent cancellation of the shop licence.

The policy enforces strict adherence to Maximum Retail Price (MRP) guidelines and prohibits unauthorized sales, the distribution of spurious liquor, brand mixing, and dilution. The government has established a tiered penalty system to deter these practices. A first offence related to MRP violations, non-duty paid liquor sales, or brand tampering will attract a penalty of 10 lakh rupees, according to the notification details. However, other reports indicate that unauthorized sales could trigger penalties as high as 25 lakh rupees for a first offence.

If a licensee is found committing a second offence, the policy allows for the immediate cancellation of the licence. The excise department has been directed to maintain strict surveillance and enforcement against any unauthorized sale points of liquor across the state. These measures are intended to curb illicit trade and ensure that all retail operations remain within the legal parameters established by the 2026-27 excise framework.

The current excise policy is set to expire on September 30, 2026, with the new 2026-27 policy taking effect on October 1, 2026. Existing licensees must complete their renewal applications and payments in accordance with the newly notified rates to maintain their operational status. For shops that are not renewed, the excise department is expected to initiate the draw of lots process to ensure all 3,736 outlets are operational by the start of the new excise year. The department will continue to monitor compliance with the new digital and physical surveillance mandates as the transition to the 2026-27 policy period commences.