No subsidised LPG for those earning above Rs 10 Lakh

SansadTV Bureau
FILE: File photo of LPG cylinders.

FILE: File photo of LPG cylinders.

Centre has decided that the tax payers with an annual income of more than Rs 10 lakh will not be entitled for the subsidised cooking gas (LPG) from January 2016. The move follows BJP-led NDA government’s appeal seeking financially well-off people to give up their subsidised cooking gas. According to the government, over 57.5 lakh LPG consumers, out of nearly 15 crore customers, have given up subsidies so far.

The Central government, on Monday, came out with a statement announcing that “benefit of the LPG subsidy will not be available for LPG consumers if the consumer or his/her spouse had taxable income of more than Rs 10 lakh during the previous financial year computed as per the Income Tax Act, 1961”.

“This would initially be done on “self-declaration basis while booking cylinders from January 2016 onwards,” the statement added.

At present, all households are entitled to get 12 cylinders of 14.2-kg each at subsidised rate of Rs 419.26, while the market price is Rs 608.

“While many consumers have given up subsidy voluntarily, it is felt that consumers in the higher income bracket should get LPG cylinders at the market price,” the statement from the Union Oil ministry said adding that the government had asked well-off people to instead buy cooking fuel at market price.

To cut subsidy bill and reduce fiscal deficit, the previous Congress-led UPA government had restricted the number of subsidized domestic cylinders per household to six every year in September 2012, revising it to nine the few months later in January 2013. The cap was, however, revised in January 2014 to 12 cylinders a year, starting April 1.

The subsidy for 12 cylinders in a year is paid directly in the bank account of consumers which they use to buy LPG at market rate.

The subsidy payout on LPG in 2014-15 was Rs 40,551 crore, which this fiscal will be less than half as oil prices have slumped to six year low. During April-September, the subsidy outgo was Rs 8,814 crore.

Presently, there are 16.35 crore LPG consumers in the country. This number fell to 14.78 crore after the start of Direct Benefit Transfer on LPG (DBTL) scheme which eliminated duplicate and inactive customers.

“The objective of the scheme was to ensure that the subsidy benefits go to the targeted group,” the statement issued by the Union Oil ministry read.

(With the inputs from the PTI)