New Delhi, January 19 (IANS) Following the central government, the Delhi government has hiked the sales tax on petrol and diesel by 2 percentage points to 27 percent, neutralising the benefit of the recent crash in global oil prices passed on to customers.

As a result, the prices of petrol are now higher by close to 70 paise at Rs.60.07, while that for diesel are up nearly 35 paise at Rs.44.77 in the national capital, as per the figures available with the state-run Bharat Petroleum Corp.

On January 15, there was a near-simultaneous action by oil marketing companies and the central government -- the first cutting its retail prices to pass on the crash in global oil prices and the latter hiking its excise rates fot the fourth time in three months.

Yet, this brought some respite to the customers, as petrol prices saw a net cut of 32 paise per litre, while that for diesel was 85 paise per litre.

All India Petroleum Dealers Association president Ajay Bansal has strongly opposed the increase in the value added tax (VAT) by the Delhi government resulting in increased price of petrol by 0.96 paise per litre and 0.53 paise per litre on diesel.

Declaring that the petroleum industry is the largest contributor of VAT across, Bansal said in a statement here: "Petrol pumps are already under severe financial pressure due to loss of sales during the 'odd-even' scheme.

"Sales were reduced by 25-30 percent on volume basis and any further VAT increase will cause huge losses as the sales will shift to surrounding states of Delhi."

"A representation of strong protest in this regard has already been sent to all the concerned departments and if no favourable reply is received, the Delhi dealers will have no choice but to declare an agitation, if required," he added.