Budget 2026 Expectations Updates: As India prepares for Union Budget 2026, the alcohol and beverage (alcobev) industry is looking for a major policy reset that brings clarity, transparency and long-term predictability across taxation and regulation.
Prasann Kedia, Managing Director at Associated Alcohols & Breweries, says the sector is hopeful that the upcoming Budget will rationalise taxes and introduce an alcohol-content-based tax structure to remove pricing distortions and improve competitiveness.
Why the Alco-Bev Sector Wants Tax Reform
India’s alcobev industry operates under a complex and fragmented tax regime, with wide variations across states.
This leads to:
- Pricing distortions between states
- Lack of transparency for consumers
- High compliance burden for manufacturers
- Unpredictable business environment
According to Kedia, a move towards an alcohol-content-based tax structure can bring fairness and simplicity.
What Is Alcohol-Content-Based Taxation?
Instead of taxing products only on volume or category, tax is linked to:
- Actual alcohol percentage
- Strength of the beverage
- Consumer impact
This creates a more balanced and rational system for:
- Spirits
- Beer
- Wine
- Ready-to-drink beverages
Key Budget Expectations from the Alco-Bev Industry
1. Rationalisation of Taxes and Regulations
“The alcobev sector is hopeful for measures that bring greater policy predictability and rationalisation across taxation and regulatory frameworks,” said Prasann Kedia.
Budget 2026 Ask
- Move to alcohol-content-based tax structure
- Reduce state-level pricing distortions
- Improve transparency for consumers and manufacturers
- Create a stable, long-term policy environment
2. Simplification of Customs Duties on Imported Inputs
To support premiumisation and global competitiveness, the industry is also seeking:
- Simplified customs duties on imported raw materials
- Lower duty on brewing inputs and flavouring ingredients
- Easier import procedures for specialised equipment
This will help Indian brands compete with global players and improve product quality.
3. Clearer Import–Export Guidelines
Budget Expectations
- Streamlined import–export policies
- Faster clearances for alcobev shipments
- Clear, uniform guidelines across states
This will enable Indian manufacturers to expand exports and build global brands.
Why This Matters for India
If Budget 2026 delivers these reforms, India will see:
✔ More transparent alcohol pricing
✔ Lower compliance burden
✔ Stronger domestic brands
✔ Higher exports
✔ Better global competitiveness
A rational tax structure will also increase government revenues through better compliance and growth.
Final Thoughts
Union Budget 2026 has the opportunity to modernise India’s alcohol and beverage sector.
By moving to an alcohol-content-based tax structure, simplifying customs duties and creating clear import–export rules, the government can unlock sustainable growth, boost premiumisation and position India as a global alcobev powerhouse.
Disclaimer: This article is for educational and informational purposes only.
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