Petrol dealers in New Delhi decided to close down pumps every on Monday from May 24 to protest hike in VAT on diesel even as Chief Minister Sheila Dikshit promised to look into their demand for parity with neighbouring states like Haryana.
In a 'Gandhigiri-style' demonstration, the Delhi Petrol Dealers Association members placed bouquets outside Dikshit's residence demanding a roll back of increase in VAT rates. The Value Added Tax rate was increased from 12.5 per cent to 20 per cent on April 1.
Later, representatives of the association held talks with the chief minister who, sources said, explained the reasons that compelled the government to effect the hike mainly to finance an additional expenditure of Rs 1,100 crore incurred for Commonwealth Games preparations.
They also submitted a memorandum to Congress Chief Sonia Gandhi.
"The chief minister told us that she was holding talks with the finance ministers of the neighbouring states and also to the VAT committee to bring parity in VAT rates," Jugal Batra, former president of the association who was one of the representatives who met Dikshit, said.
"She took a considerate view of the issue. However, we are going ahead with the 'weekly off' protest and will close down the pumps every Monday. We are also thinking about shutting down after 9 PM," Batra said.
"We are losing our business to the pumps in adjoining states where diesel is cheaper by Rs 3.50 to Rs 4 due to difference in VAT.
In the last few weeks after the hike, the sale of diesel in around 200 pumps located at the borders has come down by over 40 per cent as motorist and truckers are choosing petrol pumps in Gurgaon, Faridabad and Noida due to the price difference," he said.
In Delhi, diesel is available at Rs 38.10 per litre while it is cheaper in Haryana and Punjab at Rs 34.22 a litre. Both the states impose a VAT of only 8.8 per cent.
The sale of diesel in Delhi came down from 13.5 crore litres in 2008 to 10 crore litres in 2009. Instead of
addressing the problem, the state government has recently hiked VAT to 20 per cent and as a result the sales have
further dropped to six crore litres," Atul Peshawaria,president, Delhi Petrol Dealers Association.
We have also taken up the issue with Sonia Gandhi, who in 2008 had directed all Congress-ruled states not the hike VAT rates considerably so as to avoid burden on the common man," he said.
Earlier, on May 14, the fuel stations had downed their shutters for a day.