diff --git a/mypy/checker.py b/mypy/checker.py
index 1bee348bc252..39d217653f65 100644
--- a/mypy/checker.py
+++ b/mypy/checker.py
@@ -6255,7 +6255,7 @@ def has_no_custom_eq_checks(t: Type) -> bool:
                 ) and not custom_special_method(t, "__ne__", check_all=False)
 
             is_valid_target = is_exactly_literal_type
-            coerce_only_in_literal_context = True
+            coerce_only_in_literal_context = False
 
             expr_types = [operand_types[i] for i in expr_indices]
             should_narrow_by_identity = all(