GST effect: Subsidised LPG rate hiked by up to Rs 32 per cylinder

Following implementation of the Goods and Services Tax (GST), the price of domestic LPG cylinder has been hiked by up to Rs 32 per cylinder. It is the steepest rise in six years.

The subsidised domestic cooking gas will now cost Rs 477.46 per 14.2-kg cylinder, which was earlier Rs 446.65 in Delhi. Before July 1, a separate factory-gate and sales tax were levied and it resulted in zero excise duty all across India.

States including Delhi, Haryana, Chandigarh, Rajasthan, Jammu and Kashmir, Uttar Pradesh, Tamil Nadu, West Bengal and some north east states used to pay zero VAT or sales tax on LPG cylinders.

Under GST regime, a 5 per cent tax has been imposed on subsidised LPG cylinders. Now, the rates will go up in those states where VAT was nil or less than 5 per cent.

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According to information available from oil companies, in Kolkata, the subsidised LPG price has been hiked by Rs 31.67 per cylinder to Rs 480.32 and Rs 31.41 to Rs 465.56 in Chennai.

The price has also gone up in Mumbai and LPG will now cost Rs 491.25 per cylinder. Previously, 3 per cent VAT was applicable in the city.

This is the steepest increase in domestic subsidised LPG rate since June 25, 2011, a hike of Rs 50 per cylinder, which was necessitated due to a jump in international oil prices. Every household is entitled to 12 cylinders of 14.2-kg each at subsidised rates in a year. Any requirement beyond that has to be purchased at market price.

The rate of market-priced 14.2-kg cylinder in Delhi is Rs 564. Sources said the 5 per cent GST resulted in a Rs 26.88 increase in rate per cylinder in Delhi and the remaining hike of about Rs 3 is because of the decision since June last year to raise prices by about Rs 2 to cut the subsidy.

The rate of non-subsidised LPG, which consumers pay after exhausting their quota of below-market priced bottles, went up by Rs 11.5 to Rs 564. Such bottles attract an 18 per cent GST.

With PTI inputs.

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