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Home > India > Business > PTI > Report

Bengal govt cuts petro sales tax

June 04, 2008 19:02 IST

West Bengal government has decided to reduce sales tax on petrol from 25 per cent to 20 per cent and diesel from 17 per cent to 12.5 per cent,  state Finance Minister Asim Dasgupta said after a meeting with Chief Minister Buddhadev Bhattacharjee.

The Left front government with its 'limited financial power,' has decided to reduce sales tax rates on petrol and diesel, he said and urged the Centre to reconsider the price hike.

"With this reduction, the state government will incur a revenue loss of at least Rs 500 crore (Rs 5 billion)," he said.

To a question, the finance minister said sales tax on LPG had earlier been reduced from 12.5 per cent to 4 per cent, and it was not taken into consideration this time.

This move by the state's Left Front government comes in the wake of a highest ever price increase announced by the United Progressive Alliance government on Wednesday -- Rs 5 a litre for petrol and Rs 3 for diesel and Rs 50 per LPG cylinder.

The UPA government, however, spared the poor man's cooking medium kerosene from any increase. 

Sharp reactions met the government's decision to enforce the single-steepest hike in fuel prices and it came under attack from opposition parties.

"The Left parties demand that the UPA government review the decision on the price hikes. It should cut excise duties more and impose windfall taxes on private companies," Left leaders Prakash Karat, A B Bardhan, Debabrata Biswas and T J Chandrachoodan said in a joint statement.

West Bengal's ruling Left Front called for a 12-hour state-wide bandh on Thursday to protest against the hike in the prices of petroleum products.

'We are asking the people of the state to respond to the bandh call to protest against the anti-people measure of the UPA government,' Left Front chairman and state CPI-M secretary Biman Bose told reporters.

Trinamool Congress chief Mamata Banerjee also said on Wednesday that her party would observe a 12-hour bandh in West Bengal on Friday in protest against fuel price hike by the 'CPI-M-supported UPA government'.

Dubbing the fuel price hike by the UPA government as 'unfortunate and unprecedented', Banerjee said the UPA government has no right to rule.

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