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Chief minister Nitish Kumar on Monday cited growth in tourism to claim that the total ban on liquor had not resulted in any revenue loss for the state.
“There has been a phenomenal growth in tourist footfall in the state. There were statements saying that tourism will dip without availability of liquor in Bihar. I had said that those who want to consume liquor need not come to Bihar,” the chief minister said while interacting with a group of journalists at the Bihar Assembly office.
He said there was a 68 per cent growth in domestic tourism in Bihar. “While in 2015 the number of domestic tourists in the state was 1.69 crore, in 2016 it grew to 2.85 crore, showing a growth of 68 per cent. Similarly the number of foreign tourists grew from 9.23 lakh in 2015 to 10.10 lakh in 2016,” Nitish pointed out, stressing that his stand that liquor ban would not hit tourism in Bihar has been vindicated.
The chief minister, who was in Kerala last week to attend a programme on prohibition, said he had explained to his hosts – the Kerala Catholic Bishops’ Council – how Bihar had tackled the revenue loss. “The Kerala organisation showed keen interest in how we managed the deficit in finances caused by liquor ban; I explained to them how we managed the revenue loss,” he said, pointing out that even Chhattisgarh chief minister Raman Singh had taken tips from him on how prohibition had been imposed in Bihar.
Nitish said the marginal shortfall in revenue collection during the last financial year was not due to prohibition. “It was due to demonetisation which led to end of cash transaction and registration came to a standstill,” he said. The chief minister said that had there been no demonetisation, the state’s own revenue collection would have crossed last year’s numbers. “I have been saying that there has been an increase in the consumption of milk, honey and other consumer goods because people have money to spend which they earlier did on liquor. The rise in consumption of these items has led to increase in taxes,” he said.
Economists, however, differed, saying the chief minister had not factored in the losses suffered by the hospitality sector, which would take the total loss to about Rs 10,000 crore. Also, they pointed out, even production of liquor has been stopped in Bihar, resulting in losses.
“The chief minister appears to have forgotten that the state taxes on fuel, clothes, sweets and virtually every consumer item has been hiked to make up for the loss,” said an economist who did not wish to be named.