Fuel pump owners in several districts of Punjab on Friday went on hunger strike demanding reduction in VAT on diesel and petrol, and threatened not to buy fuel from oil companies from May 1 if their demands were not met.

Petrol Pump Dealers Association of Punjab is demanding reduction in VAT on diesel and petrol, claiming that higher taxes on fuel were hitting the sales of pumps located near the border areas of Haryana and Himachal Pradesh.

"We are demanding reduction in VAT on diesel which is now 90 paise a litre costlier than diesel in Haryana," Associations Vice President Ashwinder Monga said.

He said Punjab was charging 17.64 per cent VAT on diesel whereas in Haryana it was 17.22 per cent. Moreover, in Himachal Pradesh, the VAT on diesel was 16 per cent.

"As a result of lower VAT in neighbouring states, sale of fuel in bordering areas including ludhiana, Mohali, Ropar, Pathankot, Rajpura, Fatehgarh Sahib and Sangrur was affected," he claimed.

Similarly, VAT on petrol in Punjab was highest among neighbouring states including Haryana, UT Chandigarh, Delhi and Himachal Pradesh.

"It was earlier decided by northern states to bring VAT on fuel on par. But no decision still has been taken in this regard," he said.

Punjab levies 36.94 per cent VAT on petrol as against 27 per cent each in Delhi and HP and 26.25 per cent in Haryana.

"We have told the Punjab Excise and Taxation department if tax on fuel is reduced, revenue will increase by Rs 300-400 crore," Monga claimed.

Despite taking up the matter with the concerned authorities in Punjab, nothing has been done to resolve our issues, he said.

"We are left with no option but to observe hunger strike. If our demands are not met, we shall stop buying fuel," said Monga.