Fuel dealers in Maharashtra, who were on an indefinite strike since Sunday midnight seeking lower sales tax on auto fuel in the state, called off their stir on Tuesday after the petroleum ministry assured them of considering their demand.
The strike was called off by the dealers representatives after a meeting with Petroleum Minister Murli Deora that lasted for more than an hour.
As many as 2,200 dealers in the state joined the strike that started Sunday midnight to protest the high 33 per cent sales tax on diesel in the state, which they contended was leading to flight of high volume business to neighbouring states of Chhattisgarh, Goa and Andhra Pradesh.
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Deora said he had raised the issue with the Maharashtra government and also facilitated a meeting between the Federation of Maharashtra Petrol Dealers' Association (FAMPEDA) representatives and the state finance minister.
"I spoke to the chief minister late yesterday and he has agreed to look into the issue. Meanwhile, the dealers will be meeting the state finance minister later today to discuss the matter," Deora told reporters.
The meeting here today was also attended by Civil Aviation Minister Praful Patel, whose party NCP is an ally of the state government.
A Petrol Dealers' Association (Mumbai) leader said the strike has been called off after the petroleum minister assured them of reviewing the high tax on auto fuel.
"We have been assured by the minister and the matter will be resolved within a week's time," he said.
The sales tax in Maharashtra is one of the highest in the country leading to its fuel prices being Rs 4-5 per litre higher than anywhere else in India.
The tax in the neighbouring states of Goa is 21 per cent, in Andhra Pradesh 28 per cent and in Karnataka 30 per cent.
"We have demanded a sales tax of 26 per cent which would be at par with other states," a dealers' representative said.
The dealers assured the minister that whatever loses have been incurred by the state government due to the flight of business to neighbouring states, will be wiped off in a span of six months if the taxes were levied at par with other states.
Deora said that only Maharashtra had suffered a negative growth in fuel sales in the country as it was losing on business due to the high tax.
"If the sales tax is in parity with other states then the sales will automatically go up," he said.
Oil marketing companies sell 100,000 tonne of petrol and 180,000 tonne of diesel in the state every month. Apart from the sales tax, the dealers had also demanded that no action be taken under the Marketing Discipline Guideline (MDG).
Indian Oil Corp Chairman Sarthak Behuria, who also attended the meeting, said the government had agreed that no action will be taken under MDG.
He also said that the government had in principle agreed to share the increased commission on CNG between the oil marketing companies and the dealers.
Gas utlities IGL and MGL had increased their commission to the oil PSUs and the dealers had complained that they should also receive the increased commission share as their expenses have gone up considerably.