Adviser rules out further tax cuts on edible oils

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FE Report
Finance Adviser Mirza Azizul Islam Thursday ruled out the possibility of further reducing taxes on imported edible oil as the practice does not, in effect, help to rein in prices.
In the current fiscal budget, the government totally withdrew the import duty of edible oil causing substantial revenue loss to the national exchequer, but the consumers are yet to benefit from the step taken, he said.
He also directed the importers to sell edible oil at a fixed price of Tk 80 per litre at retail level during Ramadan.
He said these in a meeting with the high-ups of the National Board of Revenue (NBR) and also attended by businessmen involved with import of edible oil.
The existing ad valorem tax on edible oil is 18.75 per cent which includes 15.75 per cent value added tax (VAT) and 3.0 per cent Advance Income Tax (AIT).
The edible oil importers demanded withdrawal of VAT on edible oil import to keep its price steady after Ramadan ends.
They claimed that there is sufficient stock of edible oil, about 150,000 tonnes, to meet the consumers demand during Ramadan.
The importers apprehends that there might be a shortage of edible oil after Ramadan as there will be less imports due to soaring prices of the commodity in the international market.
They also demanded NBR's consideration to allow deferred payment of taxes for speedy clearance of edible oil from the customs.
Responding to the demand, the NBR officials said such a step will necessitate amendment of the existing tax law.
The importers have to pay tax before clearing their goods from the port, the NBR officials said in the meeting.
The importers said the supply of edible oil is abundant in the market and there is no possibility of shortage during Ramadan.
In August, there was short supply of edible oil due to disruption in supply chain following unfavourable weather conditions.