From January, consumers with annual taxable income over Rs 10 lakh won't get subsidised LPG

The subsidy saved from the 'GiveitUp' campaign is being utilised for providing new connections to the BPL families under the 'Giveback' campaign.

hidden December 29, 2015 08:06:56 IST
From January, consumers with annual taxable income over Rs 10 lakh won't get subsidised LPG

New Delhi: The NDA government today announced that taxpayers with an annual income of more than Rs 10 lakh will not get subsidised LPG cylinders from the new year. This is the central government's decisive step to curbing the supply of subsidised cooking gas.

At present, all households are entitled to 12 cylinders of 14.2-kg each at subsidised rate of Rs 419.26, while the market price of each cylinder is Rs 608. In the assessment year 2014-15, a total of 20.26 lakh assesses were reported as having a taxable income above Rs 10 lakh, according to the Central Board of Direct Taxes data, reports The Indian Express.

From January consumers with annual taxable income over Rs 10 lakh wont get subsidised LPG

No subsidy for people with over Rs 10 lakh annual income from next year. Reuters

The government had asked well-off people to voluntarily give up using subsidised LPG and instead buy cooking fuel at market price, oil ministry said in a statement.

So far, over 57.5 lakh LPG consumers, out of nearly 15 crore customers, have given up subsidies.

"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 said.

The government, it said, "has decided that the 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, however, be done initially on "self-declaration basis while booking cylinders from January 2016 onwards."

To cut subsidy bill and reduce fiscal deficit, the previous UPA government had restricted the number of subsidised domestic cylinders per household to six every year in September 2012, revising it to nine the following January.

The cap was revised in January 2014 to 12 cylinders a year, starting 1 April.

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.

There are no estimates of how many LPG customers would have a taxable income of Rs 10 lakh or more.

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 said.

The government had also given a call to the well-to-do households for voluntarily giving up LPG subsidy.

"So far, 57.50 lakh LPG consumers have opted out of LPG subsidy voluntarily heeding the call given by the Prime Minister," it said.

The subsidy saved from the 'GiveitUp' campaign is being utilised for providing new connections to the BPL families under the 'Giveback' campaign.

This enables provision of LPG, a clean fuel, to poor households by replacing the conventional fuels such as kerosene, coal, fuel wood, cow dung, etc, relieving the poor of the hardships and health hazards from such fuels.

PTI

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