Karnataka implements Alcohol-in-Beverage excise duty and new liquor prices from May 11, 2026

The Karnataka government has implemented an Alcohol-in-Beverage (AIB) based excise duty structure in the state, along with revised pricing for liquor and beer, taking effect from May 11, 2026. The change, announced by Chief Minister Siddaramaiah during the 2026-27 state budget, was formalised through a May 8 notification and is intended to rationalise liquor pricing, reduce consumer costs, and bring Karnataka’s pricing closer to that of neighbouring states.

In a press note, the State Excise Department said the AIB framework is the first of its kind in India. It described the model as a “globally recognised” approach to alcohol taxation and said it aims to simplify how alcoholic beverage prices are determined. Under the new policy, government-administered price fixation has been deregulated. Instead, producers are allowed to position their products within specified pricing slabs based on market considerations.

A key part of the reform is the restructuring of Indian Made Liquor (IML) classification. According to the notification, IML slabs have been reduced from 16 to eight. The Excise Department said the consolidation was carried out to support availability of alcoholic beverages...