The Tamil Nadu Chief Minister, Ms J. Jayalalithaa, while condemning the hike in prices of diesel, kerosene and cooking gas, has urged the Centre to roll back the increase.
The Centre has announced a nominal reduction in excise and import duty on diesel and crude oil but expect the State Governments to reduce taxes.
According to an official press release, the Rs 3 a litre hike in price of diesel, Rs 2 a litre on kerosene and Rs 50 on a cylinder of cooking gas will hurt all sections of society particularly the poor.
Since all goods and commodities are moved by surface transport, prices will go up across the board and add to the problem of inflation. With incomes stagnating how can the people absorb further increases in prices of goods, she asked.
The Centre has allowed the oil companies to dictate prices of petrol. The companies have announced continuous hikes in petrol prices but this will impact two-wheeler and car users alone. But hiking prices of diesel, cooking gas and kerosene will impact the entire society.
Ms Jayalalithaa said the Centre does not have the ‘moral right' to ask the State Governments to offset the hike in prices by bringing down sales tax.
While it has announced a 2 per cent reduction in excise on diesel and 5 per cent on import duty for crude oil, it has advised the States to cut VAT. But VAT constitutes a major share of income for the State Governments, which are in closer contact with the people and spend more on development and welfare measures, she said.