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  3. No more LPG subsidy for taxpayers who earn over Rs 10 lakh annually

No more LPG subsidy for taxpayers who earn over Rs 10 lakh annually

29 Dec 2015 Evaluate

In a move to curb the supply of subsidsed cooking gas, the government has decided that the tax payers with an annual income of more than 10 lakh in the previous financial year computed as per the Income Tax Act, 1961 will not get the benefit of subsidy on LPG cylinders. This will be applicable from January 1, 2016 onwards. The new system will deny subsidy to such consumers even if the cooking gas connection is in the name of the spouse.

This has been initiated as the government felt that consumers in the high income bracket should buy cylinders at market price, continuing a series of reforms including market-based diesel prices, direct transfer of LPG subsidy and a new approach towards oilfield contracts that eliminates bureaucratic meddling. In keeping with the approach of trusting the citizens, the rule will initially be implemented on self-declaration basis for cylinders booked from January 2016 onwards.

At present, there are 16.35 crore cooking gas connections in the country. The government had earlier successfully implemented the PAHAL scheme, which transferred cooking gas subsidy directly to bank accounts of 14.78 crore customers to ensure that benefits go only to the target group.

The Prime Minister Narendra Modi had launched a ‘GiveitUp’ campaign earlier in the year asking those who can afford it to voluntarily give up LPG subsidy.The subsidy saved from the campaign is being utilised for providing new connections to the BPL families under the 'Giveback' campaign to help provide the clean fuel to poor households and replace kerosene, coal, fuel wood and cow dung burnt in kitchens. While many consumers have given up subsidy voluntarily, the government felt that consumers in the higher income bracket should get LPG cylinders at the market price.The government had also given a call to well-to-do households for voluntarily giving up LPG subsidy. This encouraged 57.50 lakh consumers to opt out of LPG subsidy voluntarily.


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