Tamil Nadu’s TASMAC – The untold story

Tamil Nadu State Marketing Corporation Limited (TASMAC) which runs the liquor retail business in Tamil Nadu, can in every way be described as a lifeline for the state. With the real estate slump, these revenues today are too important for the state than ever before. The total revenue accrued in 2017-18 is Rs 26,794.11 crore. The figure for the previous corresponding period was slightly higher at Rs 26,995.25 crore. According to Statistica, for the fiscal year 2016, Tamil Nadu liquor revenues stood at 296.72 billion Indian rupees, highest in India; followed by a distant Haryana at 197.03 billion rupees and Maharashtra at 180 billion. In 2016, over 30% state revenues had come from TASMAC. Today this is expected to be of a bigger ratio given the fact that real estate was a major revenue source at that time. Jayalalitha had promised in 2016 state elections that she would shut down the liquor business step by step in the five years. This is to be seen.

But the story at hand is about the very functioning of the TASMAC, reflecting the core political culture of the government and the apathy of the government to public. The state of affairs can be attributed to both, the DMK and the ADMK, which shared alcohol supply and contract bars. Exactly a year back in 2017, the consolidated salaries for the TASMAC staff were raised. Salary of supervisors was raised from Rs. 7500 per month to Rs. 9500; salary of salesmen was raised from Rs. 5600 to Rs. 7500, and that of assistant salesmen were raised from Rs. 4200 to Rs. 6500. How did these people run families at just 4200 a month in Chennai. If it was possible to run a family at just Rs. 4200 a month why did the TN MLAs seek a 50 % salary hike at around the same time, raising their salaries from Rs. 55 thousand to 1 lakh a month. How willing would these salesmen be to take up a central government duty at a consolidated pay of even 20% more?

The TASMAC has its own charter of functioning, which is very interesting, The Code of prevention and detection of fraudulent acts in Tamil Nadu State Marketing Corporation Limited – 2014. Under section 7b 1 xiii of this code: Sale of stock sold at premium (MRP violation) shall be classified as a serious offence. The quantum of penalty for such serious offence shall be prescribed by the Managing Director considering, inter-alia, the repetition of such serious offence. Under section 2 f iv, Effecting sale without bills (manual or electronic) is an offence. The ground reality is shocking.

The sales staffs on consolidated pay were recruited by Jayalalitha and they are more than happy with what they are getting, and what they are getting is at the expense of the public and the government. The entire liquor at TASMAC is sold over MRP; 27,000 crore business is run without a single bill; shocking?. Take for instance a bottle of beer costing Rs. 130, which is sold at 140 everywhere as a rule. So there is a 10 rupee gain from this bottle going to the staff. Now the net profit to the state from that bottle is the selling price minus cost price. Government pays salaries, transport, rents, taxes, overheads, etc. After this what could be the actual profit. Won’t 10 rupees be a good percent of the actual government profit? Thus every single liquor bottle that leaves the TASMAC retail shop is sold at a varying premium and none is bothered about it, as all of us have got used to it. A huge amount of money from people toward TASMAC doesn’t go into the government coffers. Given this, the government must answer as to why the functioning of TASMAC cannot be described as a “black money facilitator.” The government knows what needs to be done and has a bigger and clear picture of the ground reality.

The government must act on TASMAC with immediate effect. It can raise the costs of liquor to actual costs that people are now paying and also raise the salaries of the staff to practical levels. The government will get more revenues in this way, salesmen will be happy too, and people’s money will get where it needs to.  The bars itself have been contracted at sky high prices by the government with an undertaking to realize the costs from the alcoholic public. Costs of items sold in liquor bars exceed over three hundred percent of the market prices.

The chief minister had announced in May that the state would get rid of plastic, but months have passed and no visible change has been affected in TASMAC. Plastic glasses and water sachets rule the bars. The sad part of this is that neighboring regions like Pondicherry and Kerala have the solution but TN government is hesitant to introduce it. States like Kerala and Pondicherry have washable glass tumblers for their bars which is not feasible in Tamil Nadu given the prevailing law and order situation in the state.

Given the public promise of shutting liquor shops, it would be advisable for the government to shut shops immediately than reforming them. There have been massive public protests against the running of TASMAC. There have been incidents of school children even girls found drunk. There is very less choices for the TN government to do now, and it must do it without any further delay.