Palakkad (Kerala), Jun 25 (PTI) CPI(M) leader M B Rajesh on Thursday accused Kerala Chief Minister V D Satheesan of making "factually incorrect" statements to deflect criticism over the budget proposal to reduce tax on low-alcohol beverages.

Addressing a press conference here, the former excise minister rejected Satheesan's claim in the state assembly that the proposal had originated during the previous LDF government's tenure when current CPI (M) state secretary M V Govindan held the Excise portfolio.

"It is factually incorrect and baseless. The file he referred to only dealt with redefining low-alcohol beverages. There was no proposal to reduce taxes. It was part of the LDF government's liquor policy," Rajesh said.

He said the 2022-23 liquor policy proposed categorising alcoholic beverages into three groups -- wine, liquor and low-alcohol -- and that the policy had been implemented transparently after Cabinet approval and amendments to the rules.

"There was no decision by the LDF government to reduce tax on low-alcohol beverages," he said.

Rajesh demanded that the chief minister withdraw his statement that the previous LDF government had planned such a tax reduction but could not implement it because of the Assembly elections.

"I don't think he will withdraw it because he has no such habit," Rajesh alleged.

The LDF government had only permitted the sale of no-alcohol beverages in 2023 and had taken no further steps regarding tax concessions for low-alcohol beverages during its tenure.

"He (CM) should clarify what exactly the previous LDF government had done to justify his claim," Rajesh demanded.

Alleging that the present government had acted "secretly", Rajesh claimed the file relating to the tax proposal reached Satheesan on May 21 and remained with him for 24 days before being cleared on June 14.

"Wasn't there enough time to discuss it within the Congress and the UDF. He ensured that nobody came to know about it. What was the interest behind it?" he asked, adding that the file movement history could be verified online.

He alleged that even the Congress leadership and UDF constituents were unaware of the proposal until the Opposition raised the issue.

"If the Opposition had not exposed it, even leaders in the Congress and the UDF would not have known about the move," Rajesh claimed.

Further, he dismissed the UDF's allegation that the previous Left government had allowed the opening of a large number of new bars in the state.

He said there were 748 bars in Kerala during the Oommen Chandy-led UDF government, following which all but 28 five-star hotel bars lost their licences after amendments to the Abkari Act amid the bar bribery controversy.

According to Rajesh, there were 813 beer and wine parlours and 306 BEVCO liquor outlets when the UDF government demitted office in 2016.

He said hotels that had beer and wine parlour licences and later obtained three-star classification were subsequently granted bar licences during the LDF government's tenure.

"There are now 896 bar hotels in the state. If Oommen Chandy's liquor policy was correct, then Satheesan should close all these bars," Rajesh said.

He also claimed that the highest sale of Indian Made Foreign Liquor (IMFL) in Kerala was recorded during the UDF government's tenure in 2012-13, when 344.33 lakh cases were sold.

According to Rajesh, the average annual IMFL sales during the 2011-16 UDF government stood at 341.264 lakh cases, compared with 322.182 lakh cases during the first LDF government from 2016 to 2021 and 315.26 lakh cases during the second LDF government.

"The chief minister should speak based on facts. He should not stoop to the level of cyber warriors," Rajesh said.

The budget proposal to reduce tax on low-alcohol beverages has drawn criticism from various sections, including leaders within Congress.

Satheesan has said the final decision on the proposal would be taken by the UDF.

Meanwhile, CPI(M) state secretariat demanded that the Kerala government withdraw its budget proposal to reduce tax on low-alcohol beverages, alleging that the move was intended to benefit an alcohol manufacturing company.

In a statement, the CPI(M) state secretariat termed the government's refusal to withdraw the proposal "highly objectionable" and criticised Chief Minister Satheesan's statement that the UDF would decide its liquor policy.

The party alleged that the Chief Minister's stand amounted to a challenge to the people and showed disrespect to the Assembly.

The CPI(M) claimed that if the proposal was incorporated in the Finance Bill, it could enable a liquor-making company to secure a favourable court order.

"The government is refusing to withdraw the proposal because it fears that details of the money allegedly received through its deal with the company would come out," the statement alleged.

The party asked whether the UDF would formulate its liquor policy only after the Finance Bill was passed and claimed that if the front decided to permit the sale of low-alcohol beverages, it would result in a revenue loss of Rs 600 crore to the state exchequer.

The CPI(M) urged the Chief Minister to clarify whether the proposal to reduce tax on low-alcohol beverages by Rs 600 crore would be dropped from the Finance Bill. PTI TBA TBA ADB

Low-alcohol beverage tax reduction triggers political dispute over liquor policy, transparency, and alleged revenue loss. A political dispute arose over a budget proposal to reduce tax on low-alcohol beverages, with CPI(M) alleging that the proposal did not originate under the previous LDF government and that the earlier liquor policy only classified alcoholic beverages without deciding any tax reduction. CPI(M) sought clarification and withdrawal of the contrary statement, and also demanded withdrawal of the budget proposal, alleging that it was intended to benefit an alcohol manufacturing company and could cause revenue loss to the state exchequer.