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Fuel price hike: Pranab asks states to reduce taxes
Published on 26 Jun. 2011 12:43 AM IST
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Calling Friday’s hike in the prices of petroleum products as “modest”, Finance Minister Pranab Mukherjee expressed hope that state governments would reduce their taxes to provide relief to consumers.
The government increased diesel price by Rs 3 per litre, domestic LPG by Rs 50 per cylinder and kerosene by Rs 2 per litre. It also slashed customs and excise duties on crude oil and products, sacrificing Rs 49,000 crore in revenues.
“(It is) very modest increase. I have taken the risk of reducing the duties substantially... I think it will be around Rs 49,000 crore on account of reduction of import duty and also the excise duty,” Mukherjee told reporters after the hikes were announced.
Opposing the hike in diesel prices, Delhi Petroleum Association has urged the Delhi government to immediately reduce VAT so as to minimize its impact on inflation.
The hike is likely to push up overall inflation in the coming weeks.
Overall inflation rose to 9.06 per cent in May from 8.66 per cent in the previous month. Besides, food inflation for the week ending June 11 had touched a two-and-half-month high of 9.13 per cent.
Upset Mamata cuts LPG prices
in West Bengal by Rs. 16
PTI Adds: To provide relief to the common people reeling under hiked fuel price, West Bengal chief minister Mamata Banerjee Saturday announced her government’s decision to withdraw cess on LPG and thus save Rs 16 per cylinder for the consumers with immediate effect.
‘’I consulted my Finance minister Amit Mitra after midnight decision of the UPA government to hike prices of diesel, LPG and Kerosene oil and decided to withdraw cess collected by the state government on each LPG cylinder to give relief to common people’’, Mamta told reporters in Kolkata.
This, she said, would entail loss of Rs 75 crore to the state exchequer ‘’which we will mop up from other sources of income. But our government does not want to put more burden on the people’’.
Banerjee said that despite the repeated requests to the previous Left Front government, it did not bother to lift cess on LPG to give relief to the common people. ‘’Left Front talks big, but does nothing substantial’’. ‘’We have shown that we could do it’’, Banerjee asserted.
Cabinet reshuffle likely, Maran to be dropped
In yet another attempt by the Congress at an image correction, Prime minister Manmohan Singh is likely to go in for a Cabinet reshuffle next weekend.
Sources have told CNN-IBN that Dayanidhi Maran is certain to be dropped from the Cabinet as he faces chargesheet on the 2G issue. Prime Minister Manmohan Singh and Sonia Gandhi are likely to meet on Sunday to finalize the reshuffle.
According to sources, the Telecom ministry will remain with the Congress. The Railway portfolio is likely to remain with Trinamool, Mukul Roy is the front-runner for the post. Highways minister CP Joshi and Power minister Sushilkumar Shinde are also under the scanner. Younger leaders like Jyotiraditya Scindia are likely to be promoted.

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