Dynamite before Diwali – LPG Price Hiked by Rs. 2.94 for Subsidized Cylinder

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LPG Price Hiked by Rs. 2.94 for Subsidized Cylinder
LPG Price Hiked by Rs. 2.94 for Subsidized Cylinder

The price of subsidized cooking gas LPG has been hiked by Rs. 2.94 per cylinder because of the tax imposition on the base price. For consumers, a 14.2 kg domestic LPG cylinder will cost Rs. 505.34. While the non-subsidized or market price LPG rates have also gone up by Rs. 60 per cylinder to Rs. 880.

Since June, this is the sixth straight monthly increase in rates this year. The rates have increased by Rs. 14.13 per cylinder since then. The government offers subsidy on 12 cylinders per household in a year by crediting the subsidy amount directly in the accounts of the consumers. Other LPG consumers would have to buy the fuel at non-subsidized rates.

As per the news agency PTI, the subsidy amount changes every month depending on the variations occurs in the average international benchmark LPG rate and foreign exchange rate. When there is an increase in international rates, the government offers a higher subsidy.

LPG Price Hiked by Rs. 2.94 for Subsidized Cylinder
LPG Price Hiked by Rs. 2.94 for Subsidized Cylinder

According to the tax rules, the GST on LPG is calculated at the market price. Although the government would decide to subsidize a part of the price, the tax amount has to be paid at the market price and this resulted in an increase in the price of LPG cylinders.

In a statement Indian Oil Corp (IOC) said, “While the price of non-subsidized LPG at Delhi will increase by Rs 60 per cylinder in November 2018, mainly due to change in international price and foreign exchange fluctuations, the actual impact on subsidized domestic LPG customers is only Rs 2.94 per cylinder, which is mainly due to GST.”

The domestic subsidized LPG customer is protected against the increase in prices of LPG. As per the reports published by PTI, The subsidy transfer in customers’ bank account has been increased to Rs 433.66 per cylinder in November 2018 as against Rs 376.60 per cylinder in October 2018.

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