Thiruvananthapuram, June 21 

The state government is preparing to bring toddy shops under the ambit of the Goods and Services Tax (GST).

 Tax will be levied on food items sold in these establishments, including tapioca and fish curry, which are typically served alongside toddy.

The move aims to target toddy shops that generate substantial revenue under the guise of restaurants, despite officially selling only toddy. 

By bringing such outlets under the tax net, the government hopes to curb tax evasion and enhance revenue collection.

Based on a report submitted by the Excise Commissioner, the GST Department has begun initiating procedures to formulate criteria for taxation by estimating the annual turnover of these shops.

While liquor and toddy were initially exempted from GST when the law was enacted, the government has observed that many toddy shops have since evolved into large-scale food establishments. 

These outlets reportedly earn significant profits from food sales but evade taxation by misusing the exemption granted to toddy.

With the implementation of this new move, prices of food items sold in toddy shops may see a rise. However, the government views this as an opportunity to tap into a new source of revenue.