The National Board of Revenue (NBR) has reduced the Value Added Tax (MUSAC) or VAT at the import, production and trader levels of soybean oil to keep prices affordable. At the same time, VAT and advance tax on sunflower, canola oil have been reduced.
According to a notification of the Internal Resources Department of the Ministry of Finance, the decision to reduce VAT on various oils including soybean will be effective from today (December 16). This decision will remain in force till March 31.
The NBR Public Relations Office confirmed the matter on Monday (December 16).
According to the notification, refined and unrefined soybean oil, refined and unrefined palm oil, unrefined sunflower oil, unrefined canola oil have been exempted from additional VAT of 5 percent at the import level. Also, refined soybean and palm oil will be exempt from VAT at the local production level. Besides, importers will get advance tax exemption on import of crude sunflower and canola oil and refined sunflower and canola oil.
According to NBR’s Public Relations Office, Value Added Tax (MUSAC) payable at the local level on sale of sunflower, canola, soybean and palm oil has been fully exempted. Besides, the duty payable on import of all products has been reduced from 15 percent to 5 percent. As a result, there was no duty left on these products except 5 percent Musak at the import level. Total withdrawal of customs duty, regulatory duty, advance tax and advance income tax on sunflower oil and canola oil and reduction of value added tax will reduce the import cost of these oils by Tk 40-50 per litre.
Earlier on December 9, the government decided to increase the price of soybean oil by eight taka per liter. As a result, every liter of bottled soybean oil is now selling at Tk 175. The price of open soybean oil has increased from Tk 149 to Tk 157 per liter. A liter of open palm oil has also increased from Tk 149 to Tk 157. Besides, the price of five liters of bottled soybean oil is now Tk 860, which was Tk 818 earlier. However, the soybean oil market has not normalized even after the price increase.
Bangladesh Trade and Tariff Commission (BTTC) has proposed to impose tariffs to control the export of rice bran oil or rice bran oil to ensure adequate supply of edible oil in the country’s market after the increase in the price of soybean oil. The agency has therefore recommended imposition of 25 percent regulatory duty (RD) on exports of canola oil—both crude and refined.
