Impose more taxes on oil companies: CPI-M

May 28th, 2008 - 10:26 pm ICT by admin  

A file-photo of Manmohan Singh

New Delhi, May 28 (IANS) The Communist Party of India-Marxist (CPI-M) Wednesday suggested that the union government should impose more taxes on the private oil companies to meet rising world prices of petroleum and not burden the common man. “In no case can the UPA (United Progressive Alliance) government pamper the private oil companies to make windfall profits and at the same time increase the price of petrol and diesel and burden the people further when they are suffering from steep price rise of essential commodities,” a press communique from the CPI-M politburo said.

The CPI-M held a meeting Wednesday to discuss the issue of petroleum prices. There were rumours Tuesday that an oil price hike was imminent as Petroleum Minister Murli Deora said a three percent cess on income tax could be imposed to prevent losses being suffered by the petroleum marketing companies.

Prime Minister Manmohan Singh said last week that the oil companies cannot be allowed to bleed.

The CPI-M disagrees with the UPA government - which it supports from outside - on this issue.

“The profits enjoyed by private oil companies in the country have increased along with increase in oil prices,” the party said, adding “with crude oil prices now exceeding $100 barrel, it is necessary that windfall gains be recovered from all the private and joint venture oil producing companies.”

“The government should impose a ‘windfall’ profits tax on these companies,” the party suggested.

It also demanded reduction of customs duty on crude oil from five percent to nil and reduction in excise duty of petroleum products without any ad valorem (taxation at every stage of transaction) content. It also said a price stabilisation fund should be created with the money collected through cess imposed on crude oil produced by public sector oil companies.

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