Petro dealers end strike after tax cut assurance

After getting assurance from the finance minister Jayant Patil to reduce the sales tax on diesel, petroleum product dealers agreed to withdrew their no-purchase agitation with immediate effect.

It may be recalled that petrol dealers in the state launched the 'no purchase' agitation on November 19 to press for their demands to reduce the sales tax.

Maharashtra levies 33 per cent tax on diesel and 28 on petrol, while the neighbouring states like Goa, Gujarat, Karnataka levy tax between 22 and 24 per cent.

Speaking to reporters after the meeting with the delegation of Federation of Maharashtra Petrol Dealers Association (FAMPEDA) Patil said, " I promised the delegation to table the detailed note before the cabinet on how much reduction in tax means how much losses to state exchequer and what percentage of it will be compensated by the increase in the sales volumes."

After the cabinet will take decision on to what extent a cut is possible on Friday.

Speaking to reporters, FAMPEDA president Ashok Dixit said, "The talks with the state government were positive and we are confident that in future we will not have to go on strike over sales tax".

He further said, "We have demanded that sales tax should be brought down to 20 per cent so that the state will not able to compensate from the rise in sales volumes but it will able to attract business from other states."

According to our estimates petroleum dealers from the state are suffering the loss of business to 1 million kilolitres due to higher percentage of tax, he added.

Though we have asked the state government to consider reduction the tax on petrol for benefit of consumers in the state, it seems that, the state is not likely to accept our proposal on petrol as petrol is essentially local business unlike diesel which is trans-state business, Dixit said while replying to question.

Patil on this accession didn't forget to score a political point over union petroleum minister Murali Deora who few days back given unsolicited advise to the state government of reducing the sales tax to help the consumers.

Patil said, "since crude oil prices in the international market have reduced from around $ 75 per cent, per barrel to $ 55 per barrel, central government should initiate the steps to reduce the burden on consumers".