As a disclaimer, this op-ed does not intend to acclaim/promote the trade and consumption of liquor nor any type of gambling, in whatsoever manner. The Cityline report June 30 “Tax hike fuels smuggling…” was imminent, and it shows yet another case of illegal transportation and delivery of liquor from a low-tax state, Madhya Pradesh, to a high-tax state, Maharashtra.

 

There is strong circumstantial and investigative evidence suggesting that Maharashtra’s excessive taxation and pre-emptive restrictions in the past two decades on the sales and service of liquor and lotteries/legal gambling have caused shrinkage of the legal market. It has led to diversion of the persistent demand towards the black market controlled by inter-state mafia, which in turn is known to fund elections in India. This is evident largely in Bihar, Gujarat, and certain districts of Maharashtra, Tamil Nadu, and Haryana. In the name of public morality and punitive reform, many Indian states have indulged in a devious game of either over-taxation or outright ban on liquor and gambling. While these policies might appear righteous on paper, their real-world consequences are anti-national: they bolster the very inter-state mafias they aim to bust.

 

The Election Commission of India has reported record-breaking seizures of cash, liquor, and narcotics, in recent times. In 2024 alone, over ?4,650 crore was seized, much of it linked to illegal trade. More than ?500 crore worth of illegal liquor was intercepted, which is logistically impossible without political complicity. Moreover, gambling mafias operating through IPL betting apps, bookies/satta networks, and online casinos have been repeatedly busted during poll seasons in states like Maharashtra, Goa, Andhra Pradesh, and Delhi, often with cash trails leading to local politicians. These underground operations act as convenient channels for laundering black money, which is ideal for election war chests that bank on the informal economy.

 

Studies by the Association for Democratic Reforms (ADR) show that over 40% of MPs and MLAs have criminal cases, many related to illicit trade and extortion. The system isn’t broken. It’s working exactly as intended—for those who profit from the organized chaos. Politics of stigmatization followed by ad hoc prohibition and punitive taxation does not kill any vice but weaponizes it. It is high time the lawmakers became pragmatic and took surgical action against the black market/mafia that has now become a far bigger threat than that from the vice itself. The befitting quote attributed to Abraham Lincoln, “Prohibition goes beyond the bounds of reason in that it attempts to control a man's appetite by legislation and makes a crime out of things that are not crimes”, was against the ineffectiveness of prohibitionist policies during the US Prohibition era (1920–1933).