Importing wine into India sounds like a lucrative business proposition. But if that is really the case, why have some companies shut down and so many others are struggling to stay afloat? Without further ado, here is a step-by-step explanation of the various stages of duties, taxes, and other levies that an importer has to pay in order to get wine into India. India is best regarded as a giant subcontinent, a unified entity wherein each smaller part adheres to the larger central administration but then each state also has its own set of exclusive laws which can be (and most often are) entirely different from the central laws as also from those of other and/or neighbouring states. Three states will be covered in this entry: Delhi, Maharashtra (Mumbai/Bombay), and Karnataka (Bengaluru/Bangalore).
One last caveat: all taxes and levies are applied in a cumulative manner, which further inflate the final price much beyond the mathematical sum of all the individual tax/levy percentages.
The following additions are common to all foreign wine, no doubt which state they are destined for. However, these are not levied on wines of India being sent from one state to another.
- 1. Let us start with a wine at 1 Euro, CIF. It arrives into India and a 1% levy is added, and what we arrive at is then the assessable value (AV).
- 2. Next comes the Central duties, aka Customs. This is 150% on the AV and then, to that is added an extra 4%. The cumulative customs levies amount to 160%, thus giving us the customs-paid price (CPP).
- 3. To this the importer will add his margin, safe to assume anything up to 20%. Let’s call this new amount now the Importer’s Price (IP).
- 4. The Importer will take this forward and hand it to the distributor for the respective state for where the shipment/lot is destined. Thereon, the levies will vary for different states.
DELHI
I. The wine labels need to be registered for the period of one financial year, from April-March. Cost – INR5000/annum/label. So a house bringing a white and a red wine from their own Domaine (even if with the same brand name) will have to register them as two different wines.
II. The wine will now be levied with a Vend Fee, which is 65% of the IP as mentioned above. It is called Vend Fee although it is a state levy. Why not Excise? Hmm, we’ll get to that later, maybe. Let’s call this vend-fee paid price (VFPP).
III. En suite, we add the distributor’s margin, which, safe to assume, can be about 15% of the value, thus giving us the distributor price (DP).
IV. The retailer will buy the wine at DP, and will have a quasi-fixed margin, say about INR50/-. I say quasi-fixed as the state government sets the Maximum Retail Price (MRP) for all wines sold within the state of Delhi. Not very lucrative to be retailing wine then really. Oh wait, the law reads, either INR50/- per bottle or else 15% of the MRP, whichever is lower! Yep, that’s it. Fifty measly rupees.
V. Finally, a 20% VAT when one buys the wine. Strange, how a wine has excise and VAT both levied on it…oh wait, that wasn’t excise. That was a ‘Vend Fee’. Not the same thing. Oh no, not at all. All’s well then.
MAHARASHTRA
I. The registration here is INR5000/wine/annum.
II. The excise policy is simpler here. INR225/bottle for an MRP up to INR6000. Beyond that, it is 5% of MRP. Simple, that. Also, effective as it makes expensive wines become a better deal whereas the levy ensures level-playing field for entry-level foreign wines and local Indian wines, for the latter too have their tax-and-levy woes to have addressed.
III. Then it is the distributor’s margin, which can be somewhat similar to Delhi.
IV. The retailor here can add his clean 12% cut.
V. VAT stays.
KARNATAKA
I. The Karnataka State Beverage Corporation Limited (KSBCL) controls all distribution of alcohol for the state.
II. Registration is INR10,000/wine/annum.
III. They levy an excise levy of INR225/bottle.
IV. KSBCL then commands a 0.5% (distributor) margin.
V. Retailer adds 10%.
VI. No VAT! Hurrah! Why? Really!? You wish to know why they don’t charge more? Well, since they already added the margin above in point IV. But it is one most sensibly tagged margin of 0.5%.
Hope this helps outline the system, or rather, systems, prevalent in India. Sure some of you may find them inexplicably prohibitive but I know many places where the laws can be even more quirkily archaic.
Once again, this is a sketch and it merely outlines the structure of the duties and taxes. It leaves out certain details – Octroi in Mumbai, Chemical Analysis costs for new wines being registered in a state, etc. Margins commanded by both distributor and importer can always vary, depending on order size and distance from warehouse, as also other conditions of delivery (for e.g. using a refrigerated truck versus an open tempo.)
The idea was not to create a detailed flowchart for prospective exporters around the world but to merely highlight how a wine price will change to reflect the various additions along the route.
A bit discouraging some of you may feel but I can assure you that a lot of wine still sells in India. How come? –Because Indians are used to these pricings. Sure we drink better when we travel but in India, especially for those who have travelled extensively, or lived or worked abroad, and have inculcated this habit, they surely do try to keep up with it as much as they can stretch to allow themselves a glass to go with their meals. In other words, we may not be lapping up the Grands Crus and the Super-wherevers of the wine world just yet, but we are building slowly yet steadily into a formidable wine-consuming nation.
As a personal observation, if I may dare-add, in the long run, the taxes will change. They will modify in a manner that expensive wines will stand to gain from it. Lower-priced wines will face a two-edged sword: the burden of high levies and the rise in the overall quality of Indian wines which shall make it ever more competitive in the retail space in that (affordable) price segment. The discerning Indian vino will soon be one who appreciates his Barolos and Barossas, (his Champagnes and his Cape Blends, I add, for political correctitude) and enjoys them from time to time, but will sip more and more locally produced wines to quench his quotidian thirst. It’s not a bad thing at all. Good cheers all around then!
(Given my lack of dexterity with uploading a worksheet, I am happy to provide the spreadsheets to help work the calculations for the states mentioned. You may write in requesting me it. Don’t forget to say please.)
Mireia
June 3, 2013 2:15 pm
Dear Magan,
very interestin information, could you please send me the worksheep?
I’m trying to export wines to India, and it has been a really hard work… maybe all this information could help us.
Thank you vey much in advance,
Best regars. Mireia
Sunil
June 5, 2013 11:29 pm
Hi Magan,
Very informative article. Will you please give more details on chemical analysis of wines, procedures and cost in Karnataka. Also request you to provide the spreadsheet on cost to import.
regards
Sunil
Peter
June 7, 2013 12:16 pm
Magan,
Thanks for the info. I’d really appreciate it if you could send me a copy of the spreadsheet!
Cheers!
P
Krish
June 10, 2013 2:40 pm
Hello Magan,
Can you tell me the procedure for a foreign company to send their liquor samples to India. Is the procedure the same for wines and spirits? What are the charges involved in sending samples? What is the maximum quantity they can send as samples?
BaljitUbhi
June 10, 2013 3:41 pm
Hi Magan
Very informative piece, please culd you send me a copy of the Excel sheet too?
Many thanks
Bal
Karan
June 11, 2013 4:29 am
Dear Magan,
Very informative article. It seems importing wine in India might be risky and might not be the best strategy for supplying wine. Nevertheless, India is huge potential market for wine. If one thinks about the two ways wine can be supplied i.e. importing wine and producing wine from indian grapes, then what according to you would be the best way to exploit this market. Also, I was wondering if one could bypass this label cost which means rather than supplying wine on a commercial basis one could just be the postman and deliver only the wines that the customers ask for.
I would like to start supplying wines in India as i think its a huge market.
Could you please forward me your excel sheet and any opinions you might have.
best,
Karan
DEEPAK
June 12, 2013 12:34 pm
Dear Magan,
I really appreciate if could send the working file of this information
Vandna
June 12, 2013 6:32 pm
Hi Magan,
Great article. Could you please email me the detailed worksheet? Thanks in advance.
k.anup kumar
June 13, 2013 1:33 pm
Read your article, very aptly said, a novice can understand the calculations.
We are basically a Hyderabad, Andhra Pradesh, based marketing orgnaization and are planning to import wine from countries like Turkey, Bolivia, Argentina,
Australia, New Zeland.
Can you Please inform me my landing cost for the state of Andhra Pradesh – ciity Hyderabad.
Awaiting to hear from you please
Anup Kumar
Cara
June 24, 2013 11:37 am
I don’t generally enjoy lifestyle blogs but yours is really very well written. You’re humorous, informative and have great perspective. The world needs more writers like you. Please continue your writing, its a shame it ended here!
sita ananth
June 25, 2013 10:45 pm
Can you please send me your worksheet? Thanks so much!
Nand Kumar V R
June 29, 2013 1:08 pm
Hi :
Do send the worksheets; esp. Maharashtra, mentioned in the blog PLEASE. Have more to say to you, but wait for your reply and will correspond with you on matters of mutual interest. Thanks and regards,
Shiv
June 29, 2013 7:45 pm
Really appreciate the way you have articulated this topic.
I’m planning to import wine and would be really interested to know the details on the landing cost calculation.
Could you please share the calculation sheet.
Thanks
Shiv
shreyas
July 2, 2013 5:09 pm
Dear Magan,
Fantastic article. Very informative specially for fine wine lovers. I am sure all the wine lovers will agree it is not fair to pay so many taxes to enjoy a good wine. Where rest of the world do enjoy a fine wine for fraction of the cost. I hope the import duties will be reduced soon. If you could send me the worksheet that will be much appreciated. Looking forward for your e-mail
Thank you,
Shreyas
Vishal
July 2, 2013 8:38 pm
Plz mail me worksheet. Thanks
Ashish
July 8, 2013 1:45 am
Hatsoff for writing it so simple and informative. I am planing to import wine as well , but for my personal consumption. Can you suggest would it still have so many levies ?? And do I need some license to import ??
Ashish
July 9, 2013 2:13 pm
Great information shared & very informative. I would appreciate if you can send across the details.
Varun Thakur
July 11, 2013 8:41 am
Just want what I have been looking for !! Great article and very well written indeed.
Could you please email me your excel spreadsheet? Many thanks
Varun
MPSingh
July 16, 2013 11:53 am
Dear Mr Magan
I am interested in getting the following information regarding Japanese Sake import to Banglore ; Would it be possible for you collect soem information and let me know the cost regarding this research( Urgently)
I will send you the mail on you personal mail if you agree.
Thankyou
MPSingh
gagan jain
August 4, 2013 3:06 pm
can i have the e-mail of the detailed worksheets, thanks!!
Elizabeth Khan
August 5, 2013 10:17 am
Hi Magan and everyone else on the comments,
I’m lookinf for an importer and distributor in India. We are a New Zealand based company making wines, liqueurs and other unique spirits. Please email me at liz @exoticaenterprise.com.
kind regards,
Ravi kapila
August 12, 2013 10:48 am
Hi Magan,
Thanks for the information.We are interested in Importing Austrian wines to Inda and nepal.
Need more information on the same.Also PLEASE MAIL ME THE WORKSHEET
Winingly yours
Ravi
Dhruv Mohta
August 16, 2013 4:24 pm
Dear Sir,
We are just getting into the import of spirits and beer into India and specifically Bangalore. I have found the whole duty structure to be a little confusing and hence am not able to do the right pricing.
I was wondering if you could please be kind enough to send the worksheet for spirits and beers for karnataka.
It will help us a lot.
Thanking you in advance,
Warm Regards
Dhruv Mohta
Vishal
August 26, 2013 6:36 pm
Hello,
Thank you for an extremely informative article. Can you please send me the worksheet as well and any info you may have on Haryana (Gurgaon) will also be greatly appreciated. Thank you.
Ila
August 27, 2013 2:45 pm
Dear Mr. Magan ,
Thank you so much for such enlightening information.
I am working for small italian company that would like to sell their wines in India.
I would be most gratefull if you cuould share with me the workings for landed cost . Please…
Thank you so much in advance!
Looking foward to hearing from you, Kind regards,
Ila
Preeti
September 5, 2013 2:01 am
Hi Magan,
As everyone mentioned it is a very very good article. Can I have your worksheet please? would like to know How one can send samples of liquor to Maharashtra? Has the taxes really come down to 30%?
Cheers,
Preeti
AMAN
September 5, 2013 4:04 pm
HI, i would like to know what taxes the importer and distributor has to pay for importing wine. if you could please email it to me.
Varun Nair
September 25, 2013 12:06 am
Extremely interesting to read your article. Could you please mail me the spreadsheets!!! Cheers (y)
Sumathi
October 4, 2013 12:43 pm
Great information. Can you please mail me the cost sheet of working for karnataka.
Thanks
Arun
October 4, 2013 4:27 pm
Hi,
I m a wine exporter from France and i export red rose and white wines. I m searching for distributors in India. If anyone interested please contact me
Arun
October 4, 2013 4:31 pm
on arun.dayanithi@yahoo.fr
C R Titus
October 9, 2013 1:25 pm
Dear Sir
Very important information you provide in this article. Kindly advise any other licence is required and kindly send your working. We are planing for import in Mumbai in a large quantity
Regards
C R Titus
K Kumar
October 13, 2013 8:01 pm
Thanks, please send me the spreadsheets as well.
Is there a wine storage facility in Delhi?
Kumar
A.J.S.Gohar
October 13, 2013 8:52 pm
Dear Magan,
Nice informative article. Can you please send me the Spreadsheet as well.
Regards
Gohar
Arvind
October 20, 2013 2:46 pm
Nice article can you send excel sheet for Delhi
Gaurav
November 8, 2013 6:44 pm
Hi Magan,
Great article and I can see a lot of hard work has been done to put together this article. I was wondering if in your research you come across the licensing requirement to import wine and alcohol in India? I would really appreciate if you could share your finding in this matter and also please share the spreadsheet with your research.
Many thanks in advance!
sathish
November 27, 2013 3:10 pm
Hi,
Thanks for this informative article, would you be able to share your analysis worksheet please?.
Thanks in advance
Varun
December 9, 2013 4:10 pm
Hi,
It is a very informative article.
Could you please email me a copy of the worksheet?
Kind regards,
Varun
Vikas
December 13, 2013 11:27 am
Thank you for bringing such a informative analysis of taxes & hidden costs associated with importing Wines to India . I am planning to get some wine brands to import as distributor. I will highly appreciate if you can please ( Mentioned please) send me the workings for landed cost . Also , do you have any information on Chandigarh ??
Rohit Jain
December 13, 2013 6:10 pm
Hey magan …great work ..this article really helped me ..we are planning to import wine from chile..we have a good source there …pleaasseee ..mail me your spread sheet with cost bifurcations..we are put up in mumbai ..it will be great if we can meet and share some more insight about the industry ..
Thanks
Rohit ..
Jayakumar
December 31, 2013 12:48 pm
Hi Magan
thanks for the article, it was really helpful.
could u please share your spread sheet, it would be more helpful to me.
i have a good contacts in Spain, Portugal and Italy, so, am thinking of importing wine from these countries.
And If you have any information about importing wine in Tamilnadu, please share it too.
thanks i advance
Ramakrishnan Ramachandran
January 8, 2014 10:16 am
Hi. Magan, Very Interesting disection of the wine import story. Please advise if we can meet to discuss strategy to introduce wines in India from overseas and how best you can contribute to making things work rather than have a
pessimistic outlook of too much competition.
Please send me the updated spreadsheets for calculations of costs on duty paid basis and reaching retailer desk.
I am also interested in offers from overseas for wines for marketing in India but with ability to support marketing . Ram
Vadim
January 9, 2014 5:30 pm
Dear Mr. Magan,
I want to thank you for your posting, it really did help me a lot.
However, can you please provide with your whole worksheets so we can fulfill further analysis.
Thank you in advance,
Regards,
Vadim
Pranay
January 10, 2014 5:40 pm
Respected Sir,
As I am planning to import wine from Nepal to begin with and I would be extremely grateful to you if you could Please send me the spread sheet to help me better.
Sir, thank you for such a wonderful write-up as it has given me a better insight of wine imports.
Wishing you and your family well:)
Regards
Pranay
Varun
January 11, 2014 1:29 pm
Hi
If you could please forward the worksheets that would be appreciated. The article is great. I have got storage location in delhi and i am looking to import Australian & Newzealand wine, I am based in Melbourne.
Thanks
Regards
Varun
Pankaj
January 15, 2014 7:24 am
Hi all
I am planning to export wine from New Zealand to india and I would welcome if any distributors in India is interested.. Great article by Magan and can u pls email the spreadsheet please . Thank you
Sanne
January 15, 2014 3:56 pm
Hi Megan,
Super crisp and helpful article!
1. Would be great if you could send me the calc. sheet. (please 😉
2. I’m planning to bring Champagne into India, to sell to distributors. Any advice or ideas on possible show-stoppers would be super!!!
Thanks,
Sanne
Caesar
January 17, 2014 1:50 pm
Great work Magan! Please send through the excel worksheet for all the 3 states mentioned in your article.
I would like you to clarify if the duties and taxes have changed since the time you wrote this article; if so, then what has specifically changed.
Thanks a lot.
eduardo yuseff
January 31, 2014 2:59 am
Great work!!!!!!….thanks for the information……I am a Chilean Wine producer and I am very interested in exporting red wine (cabernet sauvignon and carmenere)…I want to focus my future custumers, delivering a great wine with a good bouquet, strong and bodliy wine, at a good good price… say $US 13 to 16 dollares a bottle.
Chile has one of the best wines in the world!!
hopefully yo can send me more information to pursey this goal and help me out with the taxes….and if anyone is interested we can coordinate to send samples !!
Best regards and Thanking you in advance !!
Arjun Kohli
January 31, 2014 4:24 pm
hello magan,
this article is very helpful for people like me, i am no different from the other 91 who have already posted on your article.
each one of us is just trying to have as much knowledge as we can before entering in this filed.
it is so hard to imagine that how much we are charged for importing wines to india.
i would really like to have a copy of your work done so that i could make sure that i understand everything things more and make sure that i don’t miss any thing out.
please mail me a copy of your work.
thanks,
Arjun Kohli