AP Loses Rs 2,500 Crore Revenue A Year Due To Shady Sale Of Diesel In Bulk

Vijayawada: The Andhra Pradesh government loses revenue in the form of value added tax and other taxes worth Rs 2,000 to Rs 2,500 crore annually due to illegal sale of diesel across the state.

Diesel mafia, mainly in Yanam, Pondicherry, Gujarat and Karnataka, buys diesel from oil refineries and transports it in bulk without permission and sells it at workplaces in Amaravati and other places.

While diesel costs 97 rupees per liter at gas stations, the diesel mafia sells it at a lower price between 85 rupees and 90 rupees. The state government imposes 22.25 per cent value added tax on the base price in addition to an additional Rs 4 as VAT and Rs 1 as road tax per liter of diesel.

Oil dealers say hundreds of oil tankers with a carrying capacity of 40,000 liters have entered AP to sell diesel for bulk use. Bowsers with 2 KL or 3 KL capacity enter the state without valid permits and sell the product to earn high profits.

Since this illegal practice has been going on for some time, oil traders have realized that it not only generates revenue for the state treasury but also affects their daily business. They brought the issue to the notice of the state government and issued circulars to curb this practice.

“We have contacted departments such as civil supplies and transport and will also bring this to the notice of the chief minister,” said Gopala Krishna, president of the AP oil traders federation.

Fuel traders have requested the government to form a joint committee with stakeholder departments such as civil supplies, transport, explosives, legal metrology, police, commercial tax, vigilance and oil marketing companies to prepare an action plan to stop this practice.

Ravi Kumar, general secretary of AP oil traders’ federation, said, “Unauthorized selling is causing a huge decline in our daily sales at fuel depots and affecting the flow of money to the outlets. We cannot even meet the mandatory operating expenses.”