Tasmac workers protest 'flawed' mapping in TN liquor ban as reform collides with labour

Within days of taking charge, Tamil Nadu Chief Minister Joseph Vijay has triggered a major debate in political and social circles by ordering the closure of 717 Tasmac (Tamil Nadu State Marketing Corporation) liquor outlets located within 500 metres of schools, colleges, places of worship and bus-stands across the state.

Also read: On paper only? Tasmac liquor shops open despite after TN CM Vijay's order

While supporters of Vijay's Tamilaga Vettri Kazhagam (TVK) celebrated the move as the first major social reform initiative of the new government, protests quickly emerged from Tasmac employees and unions, who alleged that many workers were left uncertain about their future following the announcement.

The government-owned Tasmac currently operates nearly 4,765 liquor shops across the state. Following the order, around 4,615 outlets remain operational as nearly 150 shops have reportedly been shut.

Closure questions

Questions are now being raised over how the 717 outlets were picked for closure and whether all the identified shops were actually functioning near restricted zones.

Though TVK Minister Adhav Arjuna had earlier stated that affected workers would be accommodated in other departments, the Tamil Nadu government later confirmed that 436 of the 717 identified Tasmac outlets had already been shut as of Saturday (May 23).

Also read: Vijay orders closure of 717 Tasmac outlets: Stern action or sheer optics?

To address employee concerns, Tasmac Managing Director (MD) K Nanthakumar issued an order directing workers from closed shops to be redistributed to nearby functioning outlets.

Entire process flawed, says union leader

However, not many were convinced. Tasmac Employees Union General Secretary K Thiruselvam strongly criticised the process behind the closure drive.

“The problem lies in how these 717 shops were identified in the first place,” he said.

“Earlier rules only required a 50-metre distance from schools and places of worship. In municipal areas, that limit was 100 metres, and shops were already regulated accordingly.”

“Now this government has raised it to 500 metres — half a kilometre. At that radius, nearly half of the existing 4,800 shops would have to shut down,” he added.

He further questioned the implementation process, asking, “So which places of worship are even being counted in this calculation?”

Thiruselvam also alleged that the closure exercise lacked planning and transparency.

“Complaints poured in about how the shops were identified — the selection process itself was flawed. This shows the entire closure drive was crooked from the start,” he said.

“The minister, the new MD, the home secretary — someone should have sat down and planned this properly. Instead, 717 shops were hastily announced for closure — but not all of them have actually been shut.”

He further claimed, “Right now, even Tasmac doesn't have a clear count of how many shops were actually closed. A government body with zero transparency.”

DMK, ADMK govts also closed Tasmac units

This is not the first time a Tamil Nadu government has announced the closure of Tasmac units as a policy move.

During the 2006-2011 ruling period of the Dravida Munnetra Kazhagam (DMK), former Tamil Nadu chief minister M Karunanidhi shut 128 Tasmac retail outlets and more than 1,300 bars. His government also reduced shop operating hours and relocated liquor outlets situated near schools and temples.

In 2016, his successor J Jayalalithaa of the All-India Anna Dravida Munnetra Kazhagam ordered the closure of 500 Tasmac outlets immediately after returning to power.

In 2023, the DMK government led by M K Stalin announced another round of closure of 500 liquor shops as part of phased prohibition efforts.

Social distress vs revenue

Alcohol consumption continues to remain a deeply emotional and political issue in Tamil Nadu.

Many families and social activists believe rising alcohol consumption contributes directly to domestic violence, indebtedness, crime and broader social distress.

Also read: ‘Something wrong within Tasmac’: Madras HC quashes action against staffers

At the same time, the state remains heavily dependent on liquor revenue.

In the 2025-26 financial year alone, Tasmac is estimated to have generated nearly Rs 50,000 crore for the state coffers. Along with property registrations, Tasmac contributed more than Rs 75,000 crore to the state's revenue collections.

Economists now warn that shutting 717 outlets could place pressure on Tamil Nadu’s finances unless the government identifies strong alternative revenue sources.

Liquor revenue rises despite shutdown

Interestingly, past data indicate that liquor revenue in Tamil Nadu continued to rise even when the number of shops was reduced.

A Tamil Nadu government white paper released in 2021 showed Tasmac revenues increased from just over Rs 4,000 crore in 2006-07 to more than Rs 33,000 crore by 2020-21 despite over 1,300 shops being shut during that period.

Experts say this suggests liquor demand remained strong even after the reduction of outlets.

Economists have suggested improving tax collection efficiency, restructuring debt, reforming loss-making public sector units, revising property guideline values and expanding public-private partnerships as possible alternatives to offset revenue loss.

'TN must rationalise welfare spending'

Professor N R Bhanumurthy of the Madras School of Economics warned that Tamil Nadu must also rationalise welfare spending for long-term fiscal stability.

“The government must focus on the financial health of public sector units and eliminating duplication across welfare programs. There must be a strong emphasis on expenditure rationalisation,” he told The Federal.

“The government should not introduce new cash transfer schemes without restructuring current ones. Otherwise, budgets will become unsustainable.”

Illicit liquor fears

There are also concerns that restricting legal liquor access without reducing demand could push consumers towards illicit liquor networks.

Tamil Nadu has witnessed several deadly hooch tragedies in recent years, including the 2024 Kallakurichi incident that killed more than 60 people.

Critics argue that unless Tasmac closures are backed by rehabilitation measures, de-addiction programmes and strict enforcement against illicit liquor, the move could create fresh social risks.

Also read: Why CM Vijay is clinging to TN's ultimate political tradition, holding home portfolio

For now, Vijay’s decision has delivered a strong political message and reinforced his government’s social reform positioning.

But whether the Tasmac closure drive becomes a sustainable reform model or turns into a fiscal burden for Tamil Nadu will depend on what the government does next.

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