VAT on import, trading of edible oils slashed
'Govt should now force companies to reduce edible oil prices'
FE REPORT | Friday, 18 October 2024
The government has reduced value-added tax (VAT) on import, processing and trading of soybean and palm oils - to lower their prices - following the demands of refiners and importers.
The Ministry of Finance, through two separate notifications on Thursday, announced the VAT relaxations in import and production stages of edible oils.
At present, VAT on local production and trading of soybean and palm oils is exempted. VAT on refined and crude soybean and palm oils in import stage is also reduced from 15 per cent to 10 per cent.
Market observers said now the government should force the companies to reduce the edible oil prices in loose form.
The Bangladesh Vegetable Oil Refiners and Vanaspati Manufacturers Association recently informed the Ministry of Commerce that the prices of soybean and palm oil are rising in the international market.
They demanded a 14.8 per cent increase in the prices of crude soybean oil and an 18.68 per cent rise in the prices of palm oil.
In a meeting with Finance and Commerce Adviser Dr Salehuddin Ahmed, the refiners said they would not raise edible oil prices in the local market, if the government would reduce import duties. They also requested removal of all tariffs on local production and trade of edible oils.
In response to these demands, the government decided to grant the tax exemptions.
Meanwhile, the prices of edible oil and palm oil in loose form, consumed hugely by commoners and restaurants, increased by Tk 5.0-6.0 a litre in last one week, according to the market sources.
Loose soybean is being retailed at Tk 156-160 and palm oil at Tk 146-152 a litre depending on markets in the city. Bottled soybean oil price, however, remained static at Tk 167-170 a litre.
S M Nazer Hossain, vice president of the Consumers Association of Bangladesh (CAB), said the Bangladesh Trade and Tariff Commission (BTTC), in collaboration with the National Board of Revenue (NBR), should provide regular data on global and import level edible oil prices.
He claimed that global oil prices witnessed a hike between April and July, but the market started to cool down from August, which should be taken into consideration.
He urged the government for pressurising the refiners to reduce the prices of edible oils in loose form to give commoners some relief, who are already in a battered condition for rocketing price trend of other essentials.