Traders want reduced VAT on edible oil

Al Amin :
The National Board of Revenue (NBR) is still unwilling to impose package Value-Added Tax (VAT) on edible oil despite the repeated call for it in order to reduce the price of the key cooking ingredient.
The Commerce Ministry and the businesses are repeatedly urging the revenue board to impose fixed VAT on edible oil to pull rein in the price hike of the essential commodity.
But the NBR is yet to be interested as the imposition of the package or VAT reduction has little effect on the prices, NBR officials said.
Taking decision on it, a high profile meeting was held in presence of three ministers at the Secretariat on Monday. Representatives of the NBR were also present in there, NBR officials said.
But the meeting concluded without any final decision in this regard, the officials said.
Businesses said they are repeatedly requesting the NBR to impose fixed VAT by combining three stages–import, manufacturing and trading– to single to curb the price spike. They said the revenue board would get Tk 12-13 per litre as revenue when the price of edible oil was $ 800 per tonne. But, at present, the VAT rate has become doubled as it price has increased to around $1500 per tonne.
So, the implementation of the package VAT will impact on the prices, they opined.
Biswajit Saha, General Manager of the City Group, told The New Nation, “We are not against the revenue collection. But it should be logical. Consumer’s sufferings are increasing due to the excessive tax burden.”
“So, the government should implement the package VAT at import stage immediately,” he said.
According to the Trading Corporation of Bangladesh (TCB), per litre bottle edible oil was selling at Tk 150-160, five litre jar at Tk 690-750 and loose oil at Tk 138-145 per litre in the city’s kitchen markets on Tuesday.
The prices were Tk 100-110 and loose oil Tk 90-95 per litre in October, 2020, according to the TCB data.
It means the prices of the edible oil have increased by around Tk 60 in a year, the data said.
The government has fixed prices of it six times to keep market stable since February of this year.
Mohammad Mustafa Haider, Director of the TK Group, said, “NBR needs to waive or reduce VAT at import stage to bring impact on edible oil price.”
“If the prices increase in global markets, we will have to follow it. But, there is no sign of drastic fall or up in prices at the moment as it has become seven to eight years high,” he added.
The country largely depends on imports to meet its consumption requirements. Bangladesh annually requires 20 lakh tonnes of edible oil and it meets almost 90 per cent of its demand through imports.