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Tuesday, Jun 28, 2011
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State to waive additional cess

Special Correspondent

Measure to cushion the effect of diesel price hike

State to forgo Rs.142.2 crore by the decision
Opposition stages walkout in the Assembly

Oommen Chandy says

THIRUVANANTHAPURAM: The State government has decided to forgo the additional cess to be accrued from the recent increase in the price of diesel, Chief Minister Oommen Chandy has said.

Replying to a notice on an adjournment motion moved by T.M. Thomas Isaac in the Assembly on Monday seeking a discussion on the hike in prices of diesel, kerosene, and LPG, Mr. Chandy said the decision to waive the cess on the revised rate would bring down the diesel price by 75 paise a litre. The State government was thus relinquishing Rs.142.20 crore it could have earned a year as cess.

The government fully sympathised with the Opposition sentiment that the oil price hike would trigger inflation and make life difficult for the common man, but the Union government had clarified that the hike was imperative and that huge amounts were being given as subsidy to oil companies every year. The State government was getting only 4 per cent value-added tax from kerosene and LPG cylinder. This was negligible. The main intention was to reduce the people's woes to the extent possible and hence decided to give up the cess from diesel. Earlier, when the government decided not to levy the cess on the revised diesel price, the Opposition did not appreciate the decision and went ahead with its protest, the Chief Minister said.

Dr. Isaac accused the Centre of forcing the common man pay the price for its corrupt practices. Even while sympathising with the Opposition, the government refused to discuss the issue. The Centre had hiked the diesel price contravening the steps taken by the Reserve Bank of India to rein in inflation. Even while posting huge profit, the public sector oil companies were hiking the oil price citing the difference between the retail rates of petrol, diesel, LPG and kerosene and international crude oil price. The UDF government headed by A.K. Antony in 2002 and subsequently Mr. Chandy had earlier increased the State cess on petrol from 20 to 23 per cent and on diesel to 24 per cent. Though the prices were revised frequently, it did not give up the State cess. Giving up cess alone was not enough, the government should pave the way for a discussion to unanimously apprise the Centre of the Assembly's protest, he said.

On the basis of Mr. Chandy's explanation, Speaker G. Karthikeyan denied leave for the notice and the Opposition walked out in protest.

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