Hike in import duty gap between crude, refined palm oil to help local industry, cool prices: Govt

Hike in import duty gap between crude, refined palm oil to help local industry, cool prices: Govt

The government on Monday said its decision to reduce the agri-cess on crude palm oil will benefit the domestic edible oil refiners and also check prices of cooking oils.

The finance ministry on Saturday cut the agri infra development cess to 5 per cent from 7.5 per cent, in order to bring down the effective duty on crude palm oil import to 5.5 per cent from 8.25 per cent.

The food ministry in a statement said the government has reduced the agri-cess for crude palm oil (CPO) from 7.5 per cent to 5 per cent with a view to provide further relief to consumers and keep in check any further rise in the prices of domestic edible oils due to an increase in the rates of edible oils globally.

“After reduction of the agri-cess, the import tax gap between CPO and refined palm oil has increased to 8.25 per cent. The increase in the gap between the CPO and refined palm oil will benefit the domestic refining industry to import Crude Oil for refining,” the ministry added.

The government has also extended the current basic rate of import duty of zero per cent on crude palm oil, crude soyabean oil and crude sunflower oil till September 2022.

The rate of import duty on refined palm oils at 12.5 per cent, and refined soyabean oil and refined sunflower oil at 17.5 per cent will remain in force till September 2022.

“This measure will help in cooling down the prices of edible oils which are witnessing an upward trend in the international market due to lower availability and other international factors,” the ministry said.

Oil industry is being called for a meeting on Tuesday to do their best in passing on the benefit to consumers and state governments have been requested to enforce stock limit order strictly, it added.

The country’s total vegetable oil (edible and non-edible oil) imports rose 16 per cent to 12.70 lakh tonnes in January, compared to 10.96 lakh tonnes in the year-ago period, industry body Solvent Extractors’ Association of India reported on Monday.

Check the source here –Source, Financial Express.