Fuel outlets to close for three days
Source: Chronicle News Service

Imphal, February 15 2024: In a move to highlight the dire circumstances faced by fuel retail outlets across the valley districts, a unanimous decision has been taken to suspend operations for three days, commencing from Friday.

This decision comes amid collective protest against exorbitant and unsustainable demands imposed by various miscreants and organisations.

The resolution was adopted during an urgent meeting convened at Hotel Nirmala, Thangal Keithel, Imphal, on Thursday, where representatives from the retail outlets discussed the pressing financial challenges they are facing.

Addressing the media post-meeting, the representatives shed light on the tax burden laid at their doorstep by the state government.

Specifically, the advance Value Added Tax (VAT) levied on petrol and diesel sales emerged as a primary concern.

Retailers are compelled to remit hefty sums in VAT upfront, engendering profound liquidity constraints until products are ultimately sold to end consumers.

Illustrating gravity of the situation, the representatives said for every 10 litres of petrol sold, retailers remit Rs 195.6 in state VAT taxes, while 5 litres of diesel translate to an onerous Rs 50.55 in VAT payments.

Such tax burdens not only impede cash flow but also curtail profit margins, imperilling the financial stability of retail operations.

The retailers also lamented stagnation of commission rates since 2017, despite rising operating costs and facility expenses.

Their commission, fixed at a modest Rs 3 per litre for petrol and Rs 2 per litre for diesel, has failed to keep pace with inflation and increased overheads, thereby eroding profit margins and hindering business sustainability.

Moreover, dealers find themselves in a vicious cycle of illegal taxation, with miscreants extorting hefty fees from tankers along the highways.

These extraneous financial burdens, coupled with prolonged delivery times due to logistical challenges, have compounded the financial quagmire confronting fuel retailers.

In addition to taxation woes, retailers spotlighted the impact of the COVID-19 pandemic and subsequent economic downturns.

Despite their efforts as frontline workers during the crisis, retailers faced unprecedented drops in sales and profitability, further exacerbating financial strain.

Highlighting their commitment to community welfare, the retailers underscored their longstanding support for various civil society organisations, local clubs, and student groups across the state.

Despite their altruistic contributions, retailers find themselves teetering on the brink of financial collapse, their goodwill overshadowed by looming financial ruin.

In light of these insurmountable challenges, fuel retailers have reluctantly contemplated temporary closures as a last resort.

However, they implored the government to intervene promptly, advocating for relief measures such as interest exemptions, extended repayment terms, and safeguards against arbitrary price reductions.

While urging for public support and cooperation to their situation, the representatives said that they will be compelled to prolong their shutdown stir if undue pressures are made on them.

Comment