INDUSTRY BODY FOR 8 PCT UNIFORM TAX ON RETAIL FUELS

States should levy an uniform 8 percent value-added tax on retail fuels instead of the sales taxes to offset the impact of high global oil prices on consumers and help state-run firms cut losses, an industry body said on Friday.Indian policymakers are concerned over the rise in crude oil prices, which was at $109.86 a barrel in the U.S., as it stoke inflation and widen trade deficit.India, which imports 70 percent of the fuel it consumes, raised retail fuel prices last month. A multitude of central and state taxes keep retail prices high.The Associated Chambers of Commerce and Industry said that although sales tax has been abolished for most products, states continue to subject oil companies to sales tax.Sales tax varies from 33 per cent to 18.9 percent in case of petrol, and 34 percent to 8.23 percent for diesel."Therefore it is suggested that a uniform VAT of 8 percent be levied on petrol and diesel so that oil companies are able to stand the burden of rising crude oil prices," it said.The chamber also said government should gradually phase out subsidies extended to sectors like food, fertilizer and petroleum. – www.reuters.com