Ahmedabad, Sep 15 (PTI): Gujarat Congress on Friday alleged that the Narendra Modi-led government was profiting even from fuel price rise and demanded reduction in the Value Added Tax (VAT) levied on diesel.

"In the whole country, no state is having such a higher tax on diesel as in Gujarat. With 21 per cent VAT and 3 per cent cess, Gujarat has the highest rate of tax burden on diesel amongst 26 states," alleged state Congress president Arjun Modhvadia while talking to media here.

"Central Government is providing subsidy of Rs 1.03 lakh crore, while Gujarat government is collecting Rs 14,000 crore in VAT from the people of the state. This government is profiting from the price increase too," he alleged.

When asked about the price hike of Rs 5 per litre of diesel, Gujarat Congress leader claimed that the decision was taken by petroleum companies.

"Decision to increase Rs 5 per litre diesel is taken by the petroleum companies, not by the central government," he said.

He added that Gujarat government has increased the burden on common people by imposing higher VAT on it. "If Chief Minister Narendra Modi is really concerned about the burden on the people of our state, then he should immediately reduce the VAT levied on diesel, instead of blaming the central government," he demanded.