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Finance Ministry rejects Energy Ministry’s fuel price hike request

  • CPC Chairman hopes for some alternative solution

By Buddhika Samaraweera 

The Finance Ministry has rejected the Energy Ministry’s request to increase fuel prices, and has instead chosen to seek a solution that will see the State-owned Ceylon Petroleum Corporation (CPC) reduce its losses through government intervention.

This was revealed by CPC Chairman Sumith Wijesinghe at a press conference yesterday (17), where he stated: “If they are not allowing us to increase prices, we hope they will provide us some other form of relief.”

The Energy Ministry, on behalf of the country’s leading fuel suppliers, Ceylon Petroleum Corporation (CPC) and Lanka Indian Oil Corporation (LIOC) PLC, had recently written to the Finance Ministry requesting that they be granted some concession for the import of fuel. 

Speaking at a previous media briefing, Wijesinghe had claimed that the CPC had incurred a loss of Rs. 70 billion as of 31 August 2021. 

“Today, the CPC incurs a loss of Rs. 14.56 per litre of petrol, and the loss on diesel has increased by Rs. 31.46. What the CPC should do in this kind of a situation is to increase the fuel prices,” he had said. 

In this background, The Morning reported last week that the Energy Ministry, on behalf of the country’s leading fuel suppliers CPC and Lanka Indian LIOC, had written to the Finance Ministry requesting that they be granted some concession for the import of fuel, noting that fuel prices would inevitably increase in the event that such a concession is not granted. 

When queried as to what kind of concession the companies expect, Olga, on an earlier occasion, said that the concession would most probably be a revision of the tax rates. 

“However, taxes on fuel imports and taxes charged by the Customs have been revised on a number of occasions over the past two years, and they are now in an unchangeable state,” she noted. 

Multiple attempts to contact Finance Ministry Secretary and Treasury Secretary S.R. Attygalle proved futile.