By Express News Service

NEW DELHI: As a New Year gift to the nation, and particularly the middle class, the Centre cut domestic cooking gas (LPG) prices for the second straight month on Monday, bringing down the cost of a subsidised cylinder by `5.91 and an unsubsidised one by `120.50.

With the price cut going into effect from midnight, a 14.2-kg subsidised cylinder will cost `494.99 in the national capital from January 1 and an unsubsidised one will be priced at `689, said a statement from Indian Oil Corporation Limited (IOCL). According to the firm, the price cut is due to “a fall in the price of LPG in the international market and strengthening of US dollar-rupee exchange rate”.

With GST rules mandating that tax has to be calculated on market prices, tax incidence on both subsidised and unsubsidised LPG cylinders have also fallen in tandem with market rates. “Accordingly, the upfront cash payment by the consumer of domestic LPG will also reduce by `120.50 per cylinder,” IOCL said. Subsidised cooking gas consumers will get `194.01 per cylinder subsidy in their bank accounts for January.

The current price cut comes on the back of another substantial rate reduction last month, when LPG prices fell by `133 per cylinder for non-subsidised customers and `6.52 for subsidised ones.

The two consecutive reductions have nearly offset the `14.13 per cylinder cumulative price hike for subsidised customers implemented between June and November.