Duty on non-subsidised LPG waived; 7th cylinder to cost Rs 97 less

The government has reduce customs and excise duty on domestic LPG cylinders to zero.

New Delhi: In marginal relief to consumers, the government today abolished import and excise duties on LPG cylinders they buy beyond the 6 per annum quota of subsidised cooking gas, and asked state governments to subsidise the requirements of households at their level.

The government had last week restricted supply of subsidised cooking gas to 6 per household in a year. Any requirement beyond this was to be purchased at market price, which currently works out to Rs 895 per 14.2 kg cylinder. After the abolishing of 5 percent customs duty and 8 percent excise duty, the consumer price in Delhi would come to Rs 798.

Subsidised cooking gas (LPG) in Delhi is currently sold at Rs 399 a cylinder.

"Since some LPG cylinders will not be subsidised, we have amended the notification for the non-subsidised household LPG cylinders... Customs and excise (on them) will be zero", Chidambaram told reporters.

Non-subsidised commercial LPG cylinders, however, would continue to attract customs duty of 5 percent and excise duty at 8 percent.

Taking a cue from the Congress ruled states which have increased the number of subsidised cylinders to nine per year, the Minister asked other states to follow suit.

"I welcome the decision of certain state governments to subsidise three cylinders per year of LPG in addition to six cylinders for which the subsidy would be borne by the central government...I would commend all state governments to adopt such an approach", he said.

The Minister also welcomed the decision of the Bihar government to reduce VAT on diesel from 18 percent to 16 percent which would neutralise some of the impact of the Rs 5 price hike announced by the Centre last week.