States ready to cut fuel prices, asks Centre to bear half

In the wake of high fuel prices that have inflicted on common man, a panel of state governments have agreed to cut the sale tax on petroleum fuels and asked the Centre to share half the burden.

Talking to reporters after a meeting of Finance Ministers on Monday Asim Dasgupta, West Bengal Finance Minister and the chairman of the empowered group of finance ministers said that the state governments could not maintain Rs 8000 crore losses by reducing sales tax.

The panel has scheduled to meet Finance Minister P Chidambaram regarding this issue, he said.

"We will seek further data from the civil aviation ministry. The issue will be discussed on June 23 when we meet in Srinagar."

The state-run oil marketing companies had hiked prices of aviation fuel by 18.5 percent May 31, pushing up its cost to Rs 69,227 per kilolitre in the national capital, against Rs 58,387.92 earlier.

This was followed by a 9.5-11 percent hike in base prices of petrol and diesel, which was allowed by the central government. As a result, petrol became dearer by Rs 5, diesel by Rs 3 and cooking gas by Rs 50 per 14-kg cylinder.