Tax on petrol necessary for revenue: Chidambaram

Finance minister P. Chidambaram today said taxing petrol and diesel was necessary for government revenue. "If we do not tax petrol, we will have to tax some other product," Chidambaram said, replying to a question in the Rajya Sabha.

Finance minister P. Chidambaram on Tuesday said taxing petrol and diesel was necessary for government revenue.

"If we do not tax petrol, we will have to tax some other product," Chidambaram said, replying to a question in the Rajya Sabha.

The minister said the central tax on petrol and diesel had come down in the last few years.

"Firstly, petrol and diesel have to be taxed because government needs revenue. Secondly, several states put higher tax on petrol and diesel than the centre," the finance minister told the upper house.

"There has been a reduction in taxes on petrol and diesel. In March 2007, tax per litre petrol was Rs. 14.66, which came down to Rs. 9.48 in September 2012. Diesel tax in March 2007 was Rs. 4.69 (per litre), which came down to Rs.3. 56 in September 2012," he said.

Bharatiya Janata Party leader Prakash Javadekar "appealed" to the finance minister to follow his "conscience" and said the government should reduce taxes on petrol as prices were already high.