Price cut hits hard petroleum outlets
Source: Chronicle News Service

Imphal, November 04 2021: Reduction of central excise duty levied on petrol and diesel by the Central government and reduction of VAT charge on the two petroleum products at the same time by the state government have resulted in huge loss for petroleum retail outlets which have procured/stocked up huge fuel in advance keeping in mind the upcoming festivals.

With the reduction of central excise duty by the Central government on Wednesday, prices of petrol and diesel have been reduced by Rs 5 and Rs 10 respectively while state finance department too issued a notification late Wednesday evening effecting cut in VAT charge on petrol and diesel prices by Rs 7 each.

Consequently, prices of petrol and diesel in the state have been decreased by Rs 12 and 17 respectively after reduction of central excise duty and state's VAT charge.

Though reduction of petrol and diesel prices may be a huge relief for consumers, it indeed turned out to be huge loss for retail outlets which procured/stocked huge fuel from IOCL for uninterrupted supply during festivals like Diwali, Ningol Chakkouba and upcoming Sunday before the prices were reduced.

When contacted, an official of IOCL told The People's Chronicle that 112 retail outlets operating under IOCL in the state procured 4 lakh litres of petrol and around 4 lakh litres of diesel on Wednesday alone.

When calculated, each retail outlet suffered a loss of Rs 2 lakh on average.

According to the IOCL official, one particular retail outlet gets Rs 3.18 as commission for selling one litre of petrol and around Rs 2 on one litre of diesel.

Accordingly, retail outlets which procured/stocked up fuel before price reduction suffered loss of Rs 9 for one litre of petrol and around Rs 15 for one litre of diesel when prices were actually reduced.

Meanwhile, proprietor of a retail outlet informed this daily that retail outlets are being opened with loan from banks and sudden reduction of central excise duty by the central government and VAT charge by state government at the same time caused huge loss to retail outlets opened in the state.

There would have not been such huge loss for retail outlets and had Manipur government reduced VAT charge some days after reduction of central excise duty, the proprietor opined.

Since the issuance of the notiftcationby state finance department for reduction of VAT charge by Rs 7 each on one litre of petrol and diesel, one litre petrol now costs Rs 99.38 and Rs 82.51 for one litre of diesel in the state from Thursday onwards.

Earlier, one litre of petrol was sold at Rs 111.35 and diesel at Rs 99.39 .

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