Damage control: Sonia asks chief ministers to cut tax

By IANS,

New Delhi : In an attempt to check public anger sparked by the hike in fuel prices, Congress president Sonia Gandhi has asked Congress-ruled states to cut the sales tax and Value Added Tax (VAT) on petroleum products.


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“Gandhi has requested the chief ministers of all Congress-ruled states to take whatever steps they can – including tax cuts – to reduce the burden on the common man,” party secretary Tom Vadakkan said here Thursday.

Congress sources said that Gandhi telephoned the chief ministers of Maharashtra, Andhra Pradesh, Jammu and Kashmir, Haryana, Assam, Delhi, Manipur and Goa Wednesday evening, soon after the United Progressive Alliance (UPA) government announced an increase of Rs. 5 a litre on petrol, Rs.3 a litre on diesel and Rs.50 on each cooking gas cylinder.

Some states have already announced that they would go for a tax reduction to ease the impact of the price hike. The Left-ruled West Bengal has slashed sales tax on petrol and diesel by up to 5 percent. Kerala is expected to follow suit.

The National Democratic Alliance (NDA)-ruled Bihar also said that the state government would cut sales tax on petrol from 27 percent to 24.5 percent and on diesel from 20 percent to 18.36 percent.

Congress leaders have begun discussing among themselves how to overcome what they feel will be anger directed against Prime Minister Manmohan Singh’s government in the wake of higher fuel prices.

The Congress leadership has also urged its governments to take steps to contain food prices.

Prime Minister Manmohan Singh said Wednesday evening that the fuel price hike was inevitable as the international prices of crude oil had soared.

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