New Delhi: Indian Oil Corp said on Thursday that the cost of domestic LPG (LPG) was cut by Rs 1.46 per cylinder. This is the third direct reduction in a month due to the tax impact on the decreasing market rate of fuel. In the statement, Indian Oil Corp (IOC), the country’s largest fuel retailer, said in a statement that now, 14.2 kg subsidized LPG cylinder will now be Rs 493.53 in the national capital from midnight on Thursday, while at present it is Rs 494.99.
This is the third direct monthly shortfall in LPG rates. On December 1, the cost of subsidized LPG was cut by Rs 6.52 per bottle and a reduction of 5.91 on January 1. IOC said that the reduction of LPG rates on non-subsidized or market value has been reduced to 30 rupees per cylinder “strengthening the international market and the exchange rate of US dollar-rupee due to the fall in the cost of LPG”.
Now, in Delhi, the cost of cylinder of Rs. 659 per 14.2 kg will come. The cut comes down to a reduction of Rs 120.50 on January 1 and a reduction of Rs 133 on December 1.
All LPG consumers buy fuel at the market price. The government, however, subsidizes 12 cylinders of 14.2 kg in each house in one year, which directly provides the subsidy amount in the bank accounts of the users.
Subsidized cooking gas consumers will get subsidy of Rs 165.47 per cylinder in the month of February, which was Rs 194.01 in January.
Subsidy transfer in customer’s bank account has been reduced from Rs 433.66 in November and Rs 308.60 in December.
This subsidy amount varies from month to month, depending on the average international benchmark LPG rate and change in foreign exchange rates. When international rates go up, the government provides a high subsidy. And when they come down, the subsidy is deducted.
According to tax rules, GST on LPG is to be calculated by the market rate of fuel. The government can choose to subsidize a portion of the price, but tax on the market rates will have to be paid. Therefore, with the decline in market value or non-subsidized LPG prices, the incidence of taxes on subsidized cooking fuel has also decreased, thereby reducing the current price.
Accordingly, in case of upfront cash payment by domestic LPG consumers, there will be a reduction of 30 rupees per cylinder, domestic LPG consumer will now be required to pay cash of Rs 659 per cylinder instead of 689 rupees per cylinder. ” .