Chief Minister Oommen Chandy said here on Wednesday that the state government would forgo value added tax on any increase in cooking gas prices.

Talking to the media after a cabinet meet, the Chief Minister said that there was no justification for a hike in cooking gas prices and the state government could not agree to increase the burden of consumers. It also wanted payment of subsidy through banks (direct benefit transfer) to be kept in abeyance at least for six months. If not, it would forgo tax on the subsidy portion. Tax would also be forfeited on any quantum of increase in prices, if the announcement of hike was true.

Mr. Chandy said that he had expressed his protest over the hike to Minister for Petroleum and Natural Gas Veerappa Moily and Defence Minister A. K. Antony. Mr. Moily had told him that there was no hike and reports about it were the result of a misunderstanding.

Mr. Moily had agreed to extend the time limit for submitting details of Aadhaar registration to gas agencies to get subsidy by two months. However, he had wanted the Minister not to implement the direct benefit transfer scheme in the State and keep the matter pending at least for six months. While 90 per cent of the people in the State had obtained Aadhaar cards, only 57 per cent had linked bank accounts.

He said that the government would take the suspension of new bookings by gas agencies seriously.