In its first decisive move towards curbing subsidised cooking gas, the NDA government has announced that taxpayers with an annual income of more than Rs 10 lakh will not get subsidised LPG cylinders from the new year. At present, all households are entitled to 12 cylinders of 14.2-kg each at a subsidised rate of Rs 419.26, while the market price of each cylinder is Rs 608. In 2014-15, a total of 20.26 lakh assesses were having a taxable income above Rs 10 lakh, according to the Central Board of Direct Taxes.
This would, however, be done initially on “self-declaration basis while booking cylinders from January 2016 onwards. Earlier, the government had asked “well-off people” to voluntarily give up using subsidised LPG and instead buy cooking fuel at the market price. So far, of the 14.78 crore LPG consumers in the country, over 52 lakh have given up subsidised LPG voluntarily.
During 2014-15, the subsidy on LPG was estimated at Rs 40,551 crore. The total payout this year is expected to be far lower than last year as oil prices have receded sharply. The number of LPG consumers fell from 16.35 crore to 14.78 crore after the Direct Benefit Transfer on LPG (DBTL) scheme that eliminated inactive customers and duplication.
The subsidy saved from the ‘Give it Up’ campaign, is being used for providing new connections to the BPL families. Every LPG consumer who surrenders the cooking gas subsidy is linked to a BPL household that gets the LPG connection in turn.