States demand reduction of duties on oil to check price rise

New Delhi, Jan 19 (PTI) Holding the Centre responsiblefor spiralling inflation, the Opposition states today demandeda reduction in taxes on crude oil, petrol and diesel to checkprice rise.

"Price rise is not a subject of states. It is totallyCentre''s subject. We are ready to sit with the Centre andarrive at solutions. Inflation is high because of Centre''sexport-import policy", Uttarakhand Finance Minister RameshPokhariyal Nishank told reporters

He met Union Finance Minister Pranab Mukherjee on thesidelines of a pre-Budget consultation meeting of states.

Bihar''s Deputy Chief Minister and Finance MinisterSushil Modi wanted the Centre to reduce duties on petroleumproducts to tame rising inflation which soared to 8.43 percent in December, up from 7.45 per cent a month ago.

Food inflation had soared to a year''s high of 18.32per cent for the week ending December 25 before declining to16.91 per cent in the subsequent week.

"Inflation, particularly in food and primary articles... fuelled by petrol and diesel increases has been aparticular worry for all of us. While price increase due tointernational price movements is to some extentunderstandable, the commensurate increase in taxes, which arelevied ad valorem can be avoided", Modi said.

He further said that five per cent import duty on crudeoil should be abolished and excise should be levied at flatrate instead of the current practice of imposing taxes on advalorem basis.

Delhi Finance Minister A K Walia said, "Vegetables,pulses have already been exempted from VAT (Value Added Tax)in Delhi. Some states have suggested that a fixed amount ofexcise should be levied on petrol."

Earlier in the month, Centre increased price of petrolby about Rs 2.50 a litre in view of the rising price of crudeoil in the international market.

Haryana Finance Minister Ajay Singh Yadav said thatstates needed to work in coordination to deal with the problemof hoarding.

"There are bigger states like Madhya Pradesh, Karnatakaand Himachal Pradesh. We have to work in co-ordination withCentre to remove the problems of hoarding. The BharatiyaJanaya Party has been making it a political issue," he added.

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