Erica Wald on Dissertation Reviews:
…The drinking habits of Indians changed under colonial rule, in part due to the fact that the colonial tax policy favored the consumption of “foreign” liquors over more traditional drinks such as toddy and “country” liquors. The Government of Bombay introduced the 1878 Act partly in response to criticisms of government alcohol policy by temperance advocates. These activists argued that colonial excise policy had prompted an increase in alcohol production (akbari) and that constitutional reform was needed to curb this. However, the dilemma (if it could be understood as such) for the colonial state was that excise revenues from the sale of liquor production and sale licenses represented a significant part of the revenues of each of the presidencies. Although inimical to the ideas of the temperance activists, the Bombay Act provided the presidency another way to increase its revenue. The Act placed alcoholic beverages in one of three categories: toddy; imported, or “foreign” liquor; and “country” liquor. Prior to the Act’s implementation in 1879, liquor in all forms could be sold by anyone upon payment of a license fee. The new law not only increased the tax payable on toddy trees themselves and required that tappers maintain a minimum of twenty-five trees, but fixed the price of toddy at a very low rate. The effect of these actions was to exclude the small-scale producers who had previously composed the majority of drink manufacturers. As such, the Act significantly disrupted the small-scale village economies previously dependent on the production of local liquors, shifting the contracts to wealthy monopolists who not only adulterated their liquor, but charged the public much more for it.
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