In order to give some relief to consumers, Kerala chief minister Oommen Chandy today announced the withdrawal of the incremental increase in sales tax due to the hike in diesel price. The price of diesel will be reduced by 75 paise/litre.
He said the state's exchequer would lose Rs 142.2 crore through this waiver. Diesel now costs Rs 44.11/litre in Kochi, Rs 44.39 in Thiruvananthapuram and Rs 44.45 in Kozhikode. Diesel faces a state sales tax of 24.6 per cent while petrol attracts 26 per cent. Earlier, when the price of petrol was increased the Kerala government had adopted a similar decision, reducing the price by Rs 1.22/litre.
The chief minister announced this decision in the state Assembly today while replying to an urgent motion of the Opposition mooted by Thomas Issac. Chandy was reluctant to say that the waiver of incremental hike in sales tax is a policy of the government, but only informed the house that his government would take appropriate steps to reduce the burden of the people.
Earlier, he said that Kerala would be the most serious casualty of the diesel price hike as it depends mostly on other states for essential items.
The government has yet to take a decision on the price increase of LPG and kerosene. When mediapersons cited the waiver of state duty on LPG in West Bengal, the chief minister replied that the situations were different in the two states.
Earlier, seeking approval of the house for the urgent motion, former finance minister Thomas Issac said it was not scientific to determine the price on the basis of international price of crude oil alone. The government had to consider the huge price rise and inflation prevailing in the Indian economy.
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The story of loss to the public sector oil distributing companies is also incorrect, he added. Actually, they were all working in profit and in the last financial year, the combined net profit of these companies was more than Rs 40,000 crore, he said. Issac demanded similar reduction in the tax of LPG and kerosene. The Opposition today staged a walk-out on the issue as the Speaker denied permission to present the motion.
Meanwhile, the private bus operators of the state insisted that the increase in the bus charge is imminent and if the government does not grant their demands, the services would be stopped indefinitely. The co-ordination council of various organisations of the operators had already given the strike notice to the government.