Government defers hiking LPG, kerosene prices due to local taxes

New Delhi, July 2 (IANS) The government Wednesday decided to defer revising the retail prices of domestic LPG and public distribution kerosene due to the upward revision of state specific costs (SSC) till completion of discussions with state governments.

"Revision of retail selling price of domestic LPG and PDS Kerosene to those consumers on account of upward revision of the State Specific Cost Scheme (SSC) on Domestic LPG and PDS Kerosene would be deferred till the discussions are completed with the state governments during July 2014", the petroleum ministry said here in a statement.

The decision was taken keeping the interests of consumers "utmost" in mind, it added.

Public sector oil marketing companies (OMCs) incur certain state-specific costs owing to levies such as entry tax, octroi, input tax, restrictions on value-added tax (VAT), which become irrecoverable levies for OMCs.

The government had introduced the SSC scheme in 2012 to recover such irrecoverable levies from consumers in the states and municipal areas levying such taxes.

OMCs were thereafter revising quarterly the retail prices of the sensitive petroleum products including PDS kerosene and cooking gas in 12 states levying such state specific taxes.

The latest revision in these states was due in July 2014, the statement said.