LPG price doubled in 7 years: Dharmendra Pradhan

Tax collection on petrol, diesel jumps 459% during the same period, says the Oil Minister in a written reply to Lok Sabha

March 09, 2021 10:31 am | Updated 10:34 am IST - New Delhi

The price was Rs. 819 per cylinder.

The price was Rs. 819 per cylinder.

Price of domestic cooking gas, LPG has doubled to ₹819 per cylinder in the last seven years while the increase in taxes on petrol and diesel has swelled collections by over 459%, Oil Minister Dharmendra Pradhan said on Monday.

In written replies to a spate of questions on rising fuel prices in the Lok Sabha, Mr. Pradhan said the retail selling price of domestic gas was ₹410.5 per 14.2-kg cylinder on March 1, 2014. This month, the same cylinder costs ₹819.

Small price hikes over the past couple of years have eliminated subsidy on cooking gas as well as PDS kerosene.

Mr. Pradhan said the price of domestic subsidised LPG has been raised during the last few months. It cost ₹594 per cylinder in December 2020 and now is priced at ₹819. Similarly, kerosene sold to the poor through the public distribution system (PDS) has risen from ₹14.96 per litre in March 2014 to ₹35.35 this month.

Petrol and diesel prices too are at an all-time high across the country. The rates, which vary from State to State depending on local sales tax (VAT), are currently at ₹91.17 a litre for petrol and ₹81.47 for diesel in Delhi.

"Prices of petrol and diesel have been made market determined by the government with effect from June 26, 2010 and October 19, 2014 respectively," Mr. Pradhan said. "Since then, the public sector oil marketing companies (OMCs) take appropriate decision on pricing of petrol and diesel in line with their international product prices, exchange rate, tax structure, inland freight and other cost elements."

With taxes accounting for the bulk of the retail selling price of petrol and diesel, the minister said tax collected on the two fuels was ₹52,537 crore in 2013, which rose to ₹2.13 lakh crore in 2019-20 and swelled further to ₹2.94 lakh crore in the first 11 months of current fiscal year.

The government currently levies ₹32.90 per litre excise duty on petrol and ₹31.80 a litre on diesel, he said adding that excise duty on petrol was ₹17.98 a litre in 2018 and ₹13.83 on diesel. The central government's total excise collection from petrol, diesel, ATF, natural gas and crude oil has increased from ₹2.37 lakh crore in 2016-17 to ₹3.01 lakh crore during April-January 2020-21.

Between November 2014 and January 2016, the government had raised excise duty on petrol and diesel on nine occasions to take away gains arising from plummeting global oil prices. In all, the duty on petrol rate was hiked by ₹11.77 per litre and that on diesel by ₹13.47 a litre in those 15 months.

The government had cut excise duty by ₹2 in October 2017, and by ₹1.50 a year later. But, it raised excise duty by ₹2 per litre in July 2019. It again raised excise duty in March 2020, by ₹3 per litre each. In May that year, the government hiked excise duty on petrol by ₹10 per litre and on diesel by ₹13 a litre.

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