The “huge hike” in licence fee has left the bar operators disappointed. Many of the existing players have decided to call it quits as they will have to incur “huge losses” if they throw their hat in the ring when the bar licence for a two-year period from January 2020 is finalised by Prakasam district Collector Pola Bhaskar on December 7.
‘Double whammy’
It is a double whammy for the bar operators. On the one hand they have to shell out more towards licence fee, registration fee and application fee and, on the other, pay more towards the price of liquor supplied to them when compared to the wine shops.
Payments to the State exchequer in the form of licence fee, application fee, registration fee have more than doubled when compared to the existing rate.
Preference has also been given to the wine shops with regard to the price of liquor, putting the bars operators in an unenvious position.
“It is better to switch to other businesses than running a bar in the hostile operating conditions,” opines K. Koteswara Rao, who has been running a bar at the Nellore bus stand centre. He has decided not to apply for licence soon after expiry of the existing one by December-end.
At present, each bar owner is paying ₹24 lakh per annum. Under the new policy, the bar owners have to shell out ₹45 lakh as non-refundable registration fee, ₹5 lakh as bar licence fee and ₹10 lakh as non-refundable application fee, laments G. Veeraiah, an owner of a noted bar at the Addanki bus stand area.
Differential price
Differential rate on liquor is imposed. As a result, ₹30 more per a bottle of 90 ml is charged on the bars compared to wine shops, and the price goes up to ₹240 per bottle of 240 ml, irrespective of the price of liquor.
“We fear a fall in business by 60% in the new year and, consequently, a drop in the profit margin,” says another bar owner K. Chandra Reddy.
“Only those who are not familiar with other types of businesses will continue to operate the bars after cutting down heavily on the establishment cost and downsizing the staff strength. They hope to offset the losses by gaining more on the food served in the bars,” says K. Brahamaiah, who has been in liquor business for more than three decades.
The government, in a policy to discourage the bars, has decided to reduce their number in the district from 34 at present to 23 from the new year. Accordingly, the number of bars in Ongole will be 10, followed by four in Chirala, three in Markapur, two in Kandukur, and one each in Addanki, Chimakurthy, Kanigiri and Giddalur, according to the Excise Department sources.
