Tezzbuzz Desk- Amid rising inflation and gas shortage in the country, the demand to make Piped Natural Gas (PNG) and LPG tax free has intensified. Business organizations say that the tax on fuel is directly impacting both the general public and industries.
Chamber of Trade and Industry (CTI) Chairman Brijesh Goyal has written a letter to Prime Minister Narendra Modi appealing for abolition of tax on LPG and PNG. He says that the current tax structure is putting additional financial burden on the people.
Increasing pressure from tax structure
Currently, 5% GST is applicable on domestic LPG, while 18% GST is imposed on commercial LPG.
PNG, on the other hand, does not have GST, but VAT is charged ranging from 3% to 14.5% in different states.
Around 5% VAT is applicable on PNG in Delhi, which further increases its cost.
Impact of West Asia crisis
Globally, the supply of oil and gas is being affected due to the ongoing tension and war in West Asia. Its effect is also being seen in India, where pressure on the availability of LPG has increased and people are increasingly turning to PNG.
Tremendous surge in demand for PNG
The demand for PNG connections has increased rapidly in the capital Delhi. February 2026: Around 686 new connections daily March 2026: Increase to around 2000 connections daily. In comparison, there are already about 56 lakh LPG domestic connections in Delhi, but now consumers are giving more priority to PNG as an option.
What is the main demand from the government?
CTI has made two major demands from the government: Complete abolition of GST on LPG. VAT on PNG should be abolished. The organization believes that this will reduce energy costs and provide direct relief to the common people.
What will be the benefit if taxes are removed?
If the government accepts these demands, many positive effects can be seen. The demand for removal of tax on LPG and PNG is becoming a big issue amidst the falling gas prices, less pressure on the domestic budget, falling cost of business and industry, availability of cheaper energy options, rising inflation and global energy crisis. If the government takes steps in this direction, it can prove to be a big relief for both the general public and the industry.
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