New Delhi: All India Motor Transport Congress (AIMTC) opposed the government decision to allow "small" hikes in diesel prices and said the transporters will not be able to absorb the increase in prices.
"The road transport industry won't be able to absorb any imminent hike in diesel prices and suggests that the government should reduce the excise, custom Duty and VAT on diesel, which constitutes around 50 per cent of the diesel cost," AIMTC, the industry body of transporters, said in a statement.
Government has allowed oil companies to raise diesel price by 50 paise a litre per month and bulk users are to be charged the market price.
It also said that the commercial vehicles segment, which works under contractual obligations, will be worst affected by the proposed frequent hikes in diesel prices.
Terming the decision as "not acceptable", it further said that diesel is highest input cost in running of vehicles and the decontrol regime will result in frequent fluctuation in diesel prices which would be beyond the reach of poor commercial vehicle owners to absorb.
Moreover, the transporters body also demanded bringing diesel and petrol under GST (goods and services tax) and called for putting a ceiling on taxes by the state governments and on the central excise duties on the two products.
Hike in diesel price "may lead to some reaction which may be unwarranted for all the segments of the society, trade, commerce and industry", AIMTC said, adding that "we hope that the prudence shall prevail and any decision taken having an adverse bearing on the stakeholders be reviewed in time".