The Left governments in Kerala and West Bengal will also effect a token reduction in the sales tax on petrol and diesel prices. The party wants to show to its audience that while the Congress is raising the fuel prices, its government is trying to reduce the prices in its limited capacity.
But this political move did not go down smoothly. West Bengal Chief Minister Buddhadeb Bhattacharjee himself was unhappy about this proposal from the senior central leadership. As the proposal was discussed today in the Central Committee meeting of the CPI(M), Bhattacharjee reportedly remarked: "This is my major source of revenue."
Minutes after the meeting, Politburo member from the state Brinda Karat too echoed the sentiment and hinted that the states are unable to drastically reduce their tax revenues. "Oil taxes are one of the main sources of revenue for the state governments," she said.
However, bowing down to political compulsions, it was decided that the two chief ministers will take this step after consulting their respective cabinets.
Significantly, the CPI(M)'s central committee meeting today concluded without any discussion on the much-hyped Indo-US nuclear deal. The CPI(M) leadership has placed the deal on the back burner and changed its gears to issues related to oil price hike.
Toughening its stand against oil price hike, Karat said, "We don't negotiate with the government on oil price rise. We have given alternative proposals. We can discuss those proposals but our party will not discuss price hike with anyone."
Clubbing the two issues of inflation and possible hike in oil prices, the CPI(M) Central Committee said, "The price rise of essential commodities, particularly food items, is becoming unbearable for the common people. The proposed hike in petrol, diesel and cooking gas prices has to be reviewed. Such a hike will have a cascading effect on price rise and heap further burden on the people."
The CPI(M) has reiterated its demand to remove the import duty and reduce excise duties on petrol and diesel. It has also asked for setting up of a price stabilisation fund with the oil cess contribution, taxing the windfall profits being made by private oil companies and refineries, and an end to the import parity pricing system.
"The UPA government cannot pamper the private oil companies while the public sector oil marketing companies are suffering," the Central Committee said.
Karat has threatened a countrywide protest movement in concert with the Left and secular Opposition parties if the government announces a price increase.
Not in a mood to give any credit to the Congress-led UPA, the CPI(M) also expressed its dissatisfaction on the revised farm waiver scheme, terming it as inadequate. The Central Committee demanded full debt relief for farmers of dryland areas and raising of the landholding limit to cover all small and medium farmers while stretching the cut-off limit for the debt relief to February 2008.
