Members of Indore Truck Operators and Transport Association staged a dharna on Tuesday to protest against the state government's move to hike VAT on diesel.
"The transporters will now prefer to fill tanks in other states and this in turn will reduce the diesel consumption in the state," association president Rajendra Singh Trehan told HT. The members sang bhajans during their demonstration at Bhanwarkuan Square as a mark of protest.
"The VAT on petroleum products in Madhya Pradesh is the highest in the country. Last year, when the prices of petroleum products were rising continuously, we had requested the government to reduce VAT but the government had ignored our demand. So, why has the government increased VAT now that the prices have come down," Trehan said.
The association has submitted a memorandum addressed to the Prime Minister to the divisional commissioner in this regard.
Experts say the state government's move to hike VAT on diesel by 4% to 27% will hit the sales as transporters will now prefer neighbouring states where diesel prices are lower. VAT in Maharashtra, Gujarat and UP is lower than that of Madhya Pradesh and long-distance truckers generally fill the tanks where diesel is cheaper.
"This move to hike VAT on diesel to 27% will definitely hit sales, especially in the bordering districts," MP Federation of Petroleum Dealers secretary Sudhir Arien told HT. The BJP government last week raised VAT on petrol and diesel by 4%, offsetting the Rs 2 per litre cut in prices by oil companies.