CPC seeks tax reduction on petrol - Minister | Sunday Observer

CPC seeks tax reduction on petrol - Minister

5 December, 2021

The Ceylon Petroleum Corporation(CPC) has called for a tax reduction on retail fuels or a tax increase to offset higher world prices, Petroleum Minister Udaya Gammanpila said.

Opposition MP Hesha Vitharana said the Government now charged taxes totalling Rs. 14 on a litre on diesel, Rs. 38 on super diesel, Rs. 42 on 92-Octane petrol and Rs. 65 on 95-Octane petrol and asked whether any reduction would be made.

Minister Gammanpila said the taxes quoted by the MP were broadly correct.

“There can be a difference of about a Rupee because the Port and the Airport Levy (PAL) of 7.5 percent is charged on value as a percentage,” he told Parliament. “We have asked for a tax reduction or a price increase.”

He said the CPC had lost Rs. 70 billion in the 10 months to October by paying the taxes.

“All countries charge taxes from goods with inelastic demand,” Gammanpila said. “Sri Lanka is the only country that has not raised prices in the past six months.”

Petroleum is a key source of taxes in many countries while green energy gets subsidies at the expense of taxpayers.

An attempt by environmental interventionists to charge an additional ‘carbon tax’ from fuels that were already taxed to the hilt led to so-called Yellow protests in France. Sri Lanka, however, taxes diesel, which has more carbon and pollutants at a lower rate than unleaded petrol, which is cleaner, encouraging its use.

Instead of fixing diesel taxes, environmental interventionists tried to charge an additional ‘carbon tax’ from old cars. Interventionists are also attacking the power grid, instead of fixing the problem of diesel vehicles.