INSUBCONTINENT EXCLUSIVE:
The price reduction comes soon after six consecutive monthly hikes in rates since June.Domestic cooking gas (LPG) price on Friday was cut by
Rs 6.52 per cylinder on account of tax impact on the reduced market rate for the fuel
A 14.2-kg subsidised LPG cylinder will cost Rs 500.90 in the national capital from midnight tonight as against Rs 507.42 currently, Indian
Oil Corp (IOC), the country's largest fuel retailer, said in a statement
The price reduction comes soon after six consecutive monthly hikes in rates since June
Prior to this price cut, rates had gone up by Rs 14.13 per cylinder since then
rates have been cut by a steep Rs 133 per cylinder to reflect fall in international oil rates and strengthening of the rupee
It will now cost Rs 809.50 per 14.2-kg bottle in Delhi
All LPG consumers have to buy the fuel at market price
The government, however, subsidises 12 cylinders of 14.2-kg each per households in a year by providing the subsidy amount directly in bank
rate and foreign exchange rate
When international rates move up, the government provides a higher subsidy
The government may choose to subsidise a part of the price but tax will have to be paid at market rates
So, with the fall in market price or non-subsidised LPG price, the tax incidence on subsidised cooking fuel has also come down, leading to
Rs 308.60 per cylinder subsidy in their bank accounts for the month of December
The subsidy transfer in the customer's bank account has been reduced from Rs 433.66 in November.
