The Congress-led United Democratic Front (UDF) Opposition walked out of the Assembly on Tuesday, accusing the Centre and State Governments of fuel “tax terrorism”.
The UDF dared the Government to forsake the State levy on fuel to cushion the fallout of spiralling petrol, diesel and cooking gas prices.
Congress legislator Shafi Parambil moved an adjournment motion, seeking the leave of the House to discuss the ripple effect of soaring fuel prices on household budgets, transport and freight sector and essential commodities.
He said the price for a litre of petrol in neighbouring Sri Lanka was ₹67 while it touched ₹110 in Kerala on Monday. The international price for gasoline was merely ₹47 per litre, and the rest was prohibitive Centre and State taxes.
The previous UDF Government had abandoned State fuel tax to soften the blow on citizens, and the LDF should do the same, he said.
Finance Minister K.N. Balagopal said the State had not increased local levy on fuel since 2016. The fuel price in Kerala was far lesser than the Congress-ruled States.
The previous UDF Government had hoodwinked people into thinking it had renounced fuel tax only to hike it several times on the sly. The Congress had erroneously blamed the State for the actions of the Centre, he said.
The Centre had lowered the basic excise duty on fuel, depriving States of their revenue share. Simultaneously, it slapped cess and additional special duty on fuel. The additional revenue was exclusively for the Centre and not for States, Mr. Balagopal said.
The Centre has also dismantled the fuel price regulation mechanism and allowed the free market to determine the going rate. The Centre has ensured that any reduction in the international price of crude would not benefit citizens, he said.
Mr. Balagopal said the UPA had set an example for the BJP to emulate by scrapping the oil pool account that helped Central Governments balance fuel price via market intervention and subsidy.
Leader of the Opposition V.D. Satheesan said the Government could easily relinquish the ₹690 crores it got from State tax on fuel.
It could further blunt the effect of the fuel price hike by subsidising public transport further and deploying KSRTC to ferry children and teachers to school for free, he said.