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Budget silent on edible oils tax, trade upset

Budget silent on edible oils tax, trade upset
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First Published: Mon, Jul 06 2009. 01 49 PM IST
Updated: Mon, Jul 06 2009. 01 49 PM IST
New Delhi: The Union Budget budget left import duty on edible oils unchanged on Monday, disappointing local industry that had been rooting for at least a small increase.
“There is no news for the edible oil sector. We are little bit disappointed as nothing has been announced to promote domestic oilseeds production,” said B.V.Mehta, executive director of the Solvent Extractors’ Association of India.
The market expected the government to impose a nominal tax on crude palm oil imports and marginally raise the levy on refined oils.
India allows tax free imports of crude variants, while levies a 7.5% tax on refined imports.
With soaring stocks of imported edible oils at Indian ports, the government was under pressure to slap duties on new cargoes.
An analyst said the decision to leave the tax regime unchanged indicated the government was still assessing the monsoon’s progress.
India, the world biggest edible oil consumer after China, mainly buys palm oil from Indonesia and Malaysia, and small quantity of soyoil from Brazil and Argentina.
“Imports of edible oil will continue to be higher in coming days as the global prices are at comfortable level,” said Veeresh Hiremath, senior analyst with Karvy Comtrade.
He said local prices of oils and oilseeds would decline.
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First Published: Mon, Jul 06 2009. 01 49 PM IST