Gujarat government cuts tax rate on liquor served in GIFT city

3 min readAhmedabadJun 25, 2026 01:17 AM IST

Sources said that there were repeated requests from investors as well as employers for making the exemption to the prohibition laws at GIFT City more “viable” and “affordable” both for the consumers as well as operators in the hospitality sector.

A DAY after the state government slashed the Value Added Tax (VAT) on alcohol served in the Gujarat International Finance Tec-City (GIFT City) in Gandhinagar, prices of a small peg (30 ml) fell by a range of 25-35 per cent (%) as the new rates kicked in on Wednesday.

A small peg served in the wine and dine area of GIFT City, priced at Rs 1,180 for the menu price of Rs 475, will now be available at nearly half the price – Rs 594.

The Gujarat finance department, through a notification issued June 23, revised the VAT for sale of alcohol within GIFT City. While the VAT has been reduced from 65% to 25%, officials said a “special fee” of Rs 240 on every 30 ml serving has also been abolished.

This is the second such relaxation as around six months ago, the state government lifted restrictions to allow drinking anywhere in the hotels and restaurant premises inside GIFT City and allow visitors without liquor permits into the wine and dine areas. The government also raised the per employee guest permit allowance from five to 25, in a notification issued in December last year, just before Christmas.

The new notification states that VAT has been reduced to “the extent to which the amount of tax exceeds 25 paise in the rupee.”

It adds that the “exemption is applicable to the foreign liquor served to the consumer for consumption in the approved area of wine and dine facility within the area of GIFT City Gandhinagar.”

One of the wine and dine areas at GIFT City swiftly announced the new prices on its bar menu, with the drop in rates ranging from Rs 213 to 156 for 30 ml serving  to Rs 3,028 to Rs 1,994.

Story continues below this ad

The VAT was calculated both on the menu and the social fee thus hiking the price offered at the wine and dine facilities in GIFT City.

The move is seen as efforts towards making GIFT City an “inclusive” working space as well as attracting global investors as well as employers and the workforce from other states and countries.

In December 2023, the Gujarat government allowed the consumption of liquor in hotels, restaurants and clubs through a special ‘wine and dine’ policy in GIFT City. Making an exception to Gujarat’s prohibition laws aimed at attracting global business and talent, the BJP government in the state allowed consumption of alcohol within designated and licensed establishments under a permit system.

Sources said that there were repeated requests from investors as well as employers for making the exemption to the prohibition laws at GIFT City more “viable” and “affordable” both for the consumers as well as operators in the hospitality sector.ax

Ritu Sharma is an Assistant Editor with The Indian Express' Gujarat bureau, an editorial position that reflects her experience and Authority in regional journalism. With over a decade of concentrated reporting experience, she is a highly Trustworthy and specialized journalist, especially noted for her Expertise in the education sector across Gujarat and previously Chandigarh.

Expertise

Primary Authority (Education): With over ten years of dedicated reporting on education in both Gujarat and Chandigarh, Ritu Sharma is a foremost authority on educational policy, institutional governance, and ground realities from "KG to PG." Her coverage includes:

Higher Education: In-depth scrutiny of top institutions like IIM-Ahmedabad (controversies over demolition/restoration of heritage architecture), IIT-Bombay (caste discrimination issues), and new initiatives like international branch campuses in GIFT City.

Schooling & Policy: Detailed coverage of government schemes (Gyan Sadhana School Voucher Scheme), the implementation and impact of the Right to Education (RTE) Act, teacher recruitment issues, and the impact of national policies like the NEP.

Student Welfare: Reporting on critical issues such as suicide allegations due to caste discrimination, and the challenges faced by students (e.g., non-delivery of NAMO tablets). ... Read More

Stay updated with the latest - Click here to follow us on Instagram

Tags:

ahmedabad

gujarat government