Karnataka's proposed shift to an Alcohol-in-Beverage (AIB) taxation system has triggered competing responses from industry bodies, with a broad consensus emerging that while the reform marks a structural shift, its impact across liquor categories could be uneven.
The Confederation of Indian Alcoholic Beverage Companies (CIABC) cautioned that the framework risks disproportionately affecting high-volume, lower-priced Indian Made Foreign Liquor (IMFL) segments if not carefully balanced.
The Brewers Association of India strongly backed the shift, framing it as a structural correction, while the Karnataka Brewers and Distillers Association highlighted concerns that cut across segments.
Under the draft Karnataka Excise (Excise Duties and Fees) (Amendment) Rules, 2026, taxation would shift from a price-linked slab system to one based on alcohol content per litre.
The central challenge will be balancing public health and revenue goals without disproportionately affecting specific liquor categories that anchor consumption and tax collections.
