Kerala CM V D Satheesan signals no immediate fuel tax relief despite price hikes

Thiruvananthapuram, June 2 (PTI) Kerala Chief Minister V D Satheesan on Tuesday indicated that the state government was unlikely to forgo additional revenue from recent fuel price hikes.

He added that relief measures would be considered after assessing their overall economic impact.

Replying to an adjournment motion notice moved by the opposition LDF in the Assembly, Satheesan acknowledged that repeated increases in petrol, diesel, and LPG prices were adversely affecting the public.

However, he hinted that surrendering the additional tax revenue accruing to the state was not under immediate consideration by the government.

Referring to remarks made by senior CPI(M) leader and former Finance Minister T M Thomas Isaac during the first Pinarayi Vijayan government, Satheesan said Isaac had described opposition demands for the state to forgo additional revenue from fuel price hikes by the Centre as a “folly.” “Former Finance Minister Thomas Isaac’s remarks are part of Assembly records. Is the opposition now demanding that this government do what it had earlier termed a folly?” the CM asked.

Targeting the previous LDF government over the state’s finances, Satheesan said the government could not ignore its liabilities and asked, “Shouldn’t we clear the liabilities left behind by your government?” He also pointed to dues of around Rs 3,000 crore payable to the Civil Supplies Corporation, saying such commitments had to be met.

The CM further criticised the previous LDF government for imposing a fuel cess in the name of funding social security pensions when fuel prices were at their peak.

“That was a wrong decision,” he said.

Satheesan said the government was closely monitoring the impact of rising fuel and LPG prices on households and the economy and would take an appropriate decision after a few more days.

“There have been four fuel price hikes after May 15 alone, and indications from Delhi are that prices may go up further. We need to see an end to this uncertainty. We will wait for a few more days and then take a decision,” he told the House.

The discussion also triggered a sharp exchange between Satheesan and Leader of the Opposition Pinarayi Vijayan over the White Paper on the state’s finances being prepared by the government.

Satheesan said the document would contain details of central assistance received by Kerala over the years and present an accurate picture of the state’s fiscal health.

Responding, Vijayan said the opposition would react after the White Paper was tabled and accused the government of attempting to silence criticism by repeatedly invoking it.

Describing the CM’s response to the price hike issue as “unfortunate,” Vijayan said Kerala was facing a severe inflationary situation and warned that sectors including Kerala State Road Transport Corporation would come under increasing pressure due to fuel price hikes.

He recalled that the LDF government had reduced fuel taxes in 2018 and asked whether Satheesan was prepared to honour the stand he had taken while serving as Leader of the Opposition.

Vijayan also accused the CM of adopting a different position after assuming office, alleging that he had frequently blamed the state government for fuel price increases while in opposition but was now reluctant to criticise the Centre over the latest hikes.

Moving the adjournment motion, senior CPI(M) leader and former Finance Minister K N Balagopal said the steep rise in petrol, diesel, and LPG prices had increased the cost of living and adversely affected sectors including the hotel industry.

He urged the government to forgo part of the additional revenue generated through fuel taxes and provide immediate relief to the public, arguing that waiting for prices to stabilise was impractical.

Balagopal also claimed that international crude oil prices had fallen even as domestic fuel and LPG prices continued to rise, and called on the state government to strongly take up the issue with the Centre.

He noted that previous LDF governments had announced tax concessions in 2018 and 2022, and urged the present administration to consider LPG subsidies and other relief measures.

After Speaker Thiruvanchoor Radhakrishnan disallowed leave for the adjournment motion in view of the CM's reply, LDF members staged a walkout from the House.

The Assembly witnessed brief protests by the LDF after BJP member B B Gopakumar was allowed to speak before opposition members had completed their walkout speeches.

When Vijayan remarked that the Speaker had shown “generosity” towards the BJP legislator, Radhakrishnan clarified that the opportunity had been granted as Gopakumar was a first-time member and assured the House that it would not be treated as a precedent. PTI