Diesel dealers in Uttar Pradesh Saturday threatened to stop business if the state government did not withdraw an entry tax, imposed on them in September.

The government imposed the entry tax ranging between Rs.1.81 and Rs.1.90 per litre (depending on the quality of the diesel) with effect from Sep 30.

However, the dealers say they cannot afford to pay the tax since it is way beyond their profit margin.

'Our profit on one litre of diesel is only 60 paise and if we pay the increased tax, we will be left with no other option but to stop business,' Uttar Pradesh Petroleum Association president B.N. Shukla said.

At present, there are nearly 4,000 diesel outlets in the state. Since the new taxes were imposed, the tax liability of every dealer has touched nearly Rs.350,000, Shukla said.

The association is holding a meeting of all its state members Saturday and a 'concrete decision' would be announced later in the evening, he added.

'We have also made a number of representations to the government department concerned and all the three major oil marketing companies (Indian Oil Corp, Bharat Petroleum Corp, Hindustan Petroleum Corp), but have received no relief till date,' Shukla said.

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