Petrol and diesel filling stations in the state, including Mumbai, will go dry from Monday as pump owners have revived their demand for reduction in sales tax on petroleum products.
Petrol dealers are up in arms against the state government as 33 per cent sales tax plus 1 per cent cess is the highest in the whole of India. Some pump owners have already stopped buying fresh stock from Friday night and as the existing stock dries, the pumps would be closed one by one.
Federation of All Maharashtra Petrol Dealers Association (FAMPEDA), the apex body of petrol pump owners, said 256 petrol pumps in Mumbai and 2,700 pumps in the rest of the state will remain closed.
However, 20 pumps run by the public sector oil companies in the city and 40 in the state will continue to dispense petroleum products.
Speaking to HT, FAMPEDA Mumbai unit president Ravi Shinde said: "We had called off our September 18 agitation the very next day after Chief Minister Vilasrao Deshmukh, Petroleum Minister Murli Deora and Civil Aviation Minister Praful Patel assured us that they would look into our grievances and bring down the sales tax at par with neighbouring states. Two months have passed but nobody had time even to meet us once. So we are compelled to revive our agitation."
Despite several attempts Deora could not be reached over his cellphone due to signal problems.
Due to the higher sales tax in Maharashtra, consumers are paying 8 to 12 per cent more as compared to their counterparts in neighbouring states and it translates to Rs 3 to 4 per litre of petrol and diesel. "It has to be brought down to par with other states only then we can witness increased sales volumes. Studies have indicated that the state will not lose revenue, as increased sales will cover up the reduction in sales tax. But Finance Minister Jayant Patil is not listening," Shinde said.
"Due to high prices, customers go to pumps in neighbouring states. Four hundred pumps in the border areas of the state have already closed down and another 400 are on the verge of closure due to perennial losses."
"Even customers who rushed to filling stations endorsed our stance as a drop in the prices would also benefit them," he said, adding: "the reduction in diesel prices would be beneficial for the whole economy as transportation cost would come down."
Rather than going on a flash strike, the petrol dealers have decided not to keep stock so as to escape punitive action under the Essential Services Maintenance Act-under the Act, dealers cannot deny essential commodities to customers.