Protesting against the Punjab government's move of raising tax on diesel, state fuel pump owners today refused to purchase petroleum products, saying the hike in VAT on diesel will hit their sales in the state.
"Over 90 per cent fuel pump owners today did not buy petrol and diesel for one day as mark of protest against state government's decision of raising value added tax on diesel," Punjab Petroleum Dealers' Association President J P Khanna said today.
The consumption of diesel per day in Punjab stands at around 9,000 kilolitres (KL) and of petrol at 3,000 KL.
"The daily purchase of petrol and diesel is worth about Rs 300 crore," said Khanna.
However, he said that fuel pump owners did not stop selling petroleum products to retail customers.
Describing the state government's decision to hike VAT on diesel as "irrational", Khanna said this decision has already led to about 6 per cent decline in diesel sale.
The worst-affected fuel pumps are those which are located adjoining border districts of the state.
After the hike in VAT, diesel is now priced at Rs 53.38 a litre in Punjab as against Rs 52.35 per litre in Haryana and Rs 52.64 per litre in Chandigarh.
"Transport sector, which is the bulk buyer of diesel from state, will now prefer to purchase from Haryana and Chandigarh," dealers said.
Punjab had raised VAT on diesel by 1.5 per cent to 11.25 per cent with effect from November 15, the second hike in one-and-half month period. The state also levies 10 per cent surcharge on VAT rates.
VAT on diesel in neighbouring Haryana, Himachal Pradesh and Chandigarh stands at 9.25 per cent, 10.50 per cent and 9.68 per cent, respectively.
