Government Takes Back the Decision to Reduce the Taxes to Lower Oil and Ghee Prices

Business

The government has recently reversed its significant decision to lower import levies and taxes on palm oil and palm olein in order to lower ghee and cooking oil prices in the domestic market.

According to Asad Umar, Minister of Planning and Development, the government has agreed to lower the sales tax from 17 percent to 8.5 percent and lower the customs charge from 10,000 to 5,000 metric tonnes. Further, they have decided to eliminate the Additional Customs Duty on the import of palm oil and palm olein.

Since the industry has refused to agree to a price drop, the government has discontinued presenting briefings to the Cabinet regarding this issue.

However, the reduction of customs and taxes on palm oil imports was associated to a decrease in the price of these items in the local market.

Minister Asad Umar made an announcement that the FBR will issue statutory regulatory orders (SRO) to reduce duties and taxes, however the FBR has yet to do so. His declaration of a cut in sales tax, customs duty, and additional customs duty (ADC) on edible oil imports will be impossible to implement until the FBR provides the necessary notifications.

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