Edible oil raw material import AIT to be waived for all millers

Jasim Uddin | Published: 00:00, Aug 26,2019

 
 

A file photo shows soya bean oil containers at a grocery shop in Dhaka. The National Board of Revenue would waive advance income tax on import of crude and refined edible oil by all millers to remove disparity in tax and pricing of the finished products between factories located inside and outside the economic zones.— New Age photo

The National Board of Revenue would waive advance income tax on import of crude and refined edible oil by all millers to remove disparity in tax and pricing of the finished products between factories located inside and outside the economic zones.

Officials said that the revenue board had already took the decision to withdraw 5 per cent AIT on import of five types of raw materials, including crude and refined soya bean oil and palm oil, for VAT registered refinery industries.

A statutory regulatory order amending the Income Tax Rules-1984 would be issued soon in this connection, they said.

Income tax wing of NBR on Sunday asked the IT wing to incorporate the provision of not collecting AIT on import of the products in the customs’ Asycuda World system so that importers could release their products without payment of AIT.

According to NBR, now AIT would not be applicable on import of soya bean oil and its fractions, whether or not refined, but not chemically modified, crude oil, whether or not degummed, other palm oil including refined palm oil, synthetic staple fibres of polyesters and artificial staple fibres.

Previously, edible oil refiners located inside the economic zones would not require paying the tax as NBR offered exemption to the industries involved in production of essential consumer goods including edible oil, sugar, atta and maida for selling those in the domestic market.

Earlier in July, a number of edible oil refiners, including TK Group, S Alam Group and Bangladesh Edible Oil Ltd, located outside of economic zones demanded removal of the disparity claiming that it would create imbalance in domestic industries in the sector, destabilise the market and drive many businesses out of the market.

NBR also found the claim justified, said a senior tax official.

The government may also lose a huge amount of revenue due to the exemption given to EZ industries, he said, adding that the possibility of misuse of the benefits was also there.

Initially, NBR decided to withdraw the AIT for all edible oil refiners as the product produced under tax benefit has already hit the market, he said.

Meghna Group and City Group have already received tax exemption certificates for their edible oil factories established at their own economic zones approved by the Bangladesh Economic Zone Authority.

He said that the decision would remove the disparity and create even-playing field for all types of refiners.

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