On the face of stiff opposition from the Bharatiya Janata Party (BJP), the Delhi government decided to withdraw the proposed 4 per cent value-added tax (VAT) on cooking gas which will bring down the price by about Rs12 per cylinder.
Last week, however, Delhi chief minister Sheila Dikshit appeared on NDTV's The Buck Stops Here and said she was open to rethinking the new LPG prices.
However, the Delhi finance minister A K Walia said the government was not giving back the subsidy withdrawal on LPG cylinders.
LPG cylinder price in the capital jumped by Rs40 to Rs322.80 when the Dikshit-government proposed a VAT of 4 per cent and withdrew the subsidy enjoyed by Delhiites for the cylinder in the budget for 2010-11 presented last week.
After the withdrawal of the subsidy, a domestic LPG was to cost around Rs322 per cylinder.
But after the exemption of LPG from VAT, it would now cost around Rs.310 per cylinder.
The government also withdrew the five per cent VAT on compressed natural gas (CNG) besides bringing back the VAT for tea, coffee and cocoa to 5 per cent from the proposed 12.5 per cent.