Beer prices in Karnataka are likely to go up as the state government has increased the tax on all types of beer. The tax has been raised from 195% to 205% of the manufacturing cost. On top of this, an extra 10% has been added to the Additional Excise Duty (AED), as per the new draft rules.

This means premium or imported beers could become costlier by around ₹10 per bottle. For regular or local beers, the price may go up by less than ₹5. The final increase will depend on the brand. Earlier, Karnataka had two different tax rates for beer, low-cost brands were taxed at ₹130 per litre, while others were taxed as a percentage of their cost. Now, the state has replaced this system with a flat 205% tax on the manufacturing cost for all beer brands, making the tax rate the same for everyone.

The government says the latest tax change is meant to simplify the beer tax structure. With the lower tax tier removed, all beer brands, whether cheap or premium, will now be taxed at the same rate of 205%.This is the third time beer taxes have gone up in the last three years. In July 2023, the newly elected Congress government increased the Additional Excise Duty (AED) from 175% to 185%. Another hike followed on January 20, 2025, raising it further to 195% or ₹130 per bulk litre, whichever was higher.

At the same time, the base excise duty was also changed. Instead of a single rate, a new system was introduced based on alcohol content: ₹12 per litre for beer with 5% or less alcohol (ABV), and ₹20 per litre for beer with 5–8% ABV.

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