The price of an 11.8-kg household cylinder has increased by Rs. 136.41 due to the government’s increase in the price of locally produced liquefied petroleum gas (LPG) on Tuesday.
The price of indigenous LPG, popularly known as a poor man’s fuel, has increased by Rs. 11.56 per kilogram (or 4 percent) to Rs. 277.8/kg from Rs. 266.2/kg in February 2023, according to a notification released by the Oil and Gas Regulatory Authority (OGRA) on Tuesday.
The cost of a household 11.8-kg cylinder also increased, going from Rs. 3,141.3 in February 2023 to Rs. 3,277.7 in March 2023, an increase of Rs. 136.408.
Compared to February’s pricing of Rs. 12,086 for a 45.4-kg commercial cylinder, the price has increased by Rs. 525 and is now Rs. 12,611 in March 2023.
The producers’ price of LPG (propane 40 percent and butane 60 percent) has been calculated by the OGRA to be 195,732.8/ton.
This pricing did not include the petroleum charge of Rs. 4,669/ton but did include excise duty of Rs. 85/ton. The producer price for an 11.8kg cylinder weighing Rs. 2,790.4 has been calculated under this heading.
The marketing, distribution, and transportation margins are set at Rs. 35,000 per ton (Rs. 17000/ton for marketing, Rs. 10,000/ton for distribution, and Rs. 8000/ton for transportation), or Rs. 413 per cylinder.
LPG Gas Prices Before and After 18% GST
The consumer price would be Rs. 200,401.8 per ton before the implementation of an 18% general sales tax (GST), whereas the cost of an 11.8kg cylinder is Rs. 2364.7 per cylinder.
A GST of 18% on Rs. 200,401.8 per ton would also amount to Rs. 36,072.3 per ton, or Rs. 425.65 for an 11.8-kg cylinder.
With GST, the highest producer price will be Rs. 2790.4 per cylinder or Rs. 236474.1/ton.
It’s interesting to note that low-income consumers pay a second tax of 18% GST at the rate of Rs. 6,300 per ton, or Rs. 74.34 every 11.8 kg cylinder, on top of the marketing/distribution margin of Rs. 35,000 per ton.
It is important to note that LPG prices increased by almost 30% in February (Rs. 61.8/kg and Rs. 730/11.8-kg household cylinder).
Domestic cylinder prices were Rs. 2,411 in January 2023 and Rs. 3,141.3 following a 30% increase. In places without access to natural gas pipelines, LPG is utilized for cooking purposes.
To read our blog on “Government has reduced LPG prices for January 2023,” click here.
