The Indian government has reduced the import tax on soya and sunflower oils in a bid to contain surging edible oil prices, AgriCensus reported.
Published in the government’s official gazette on 20 August, the tax cut took effect immediately and would last until the end of September, according to the report, but could be extended if prices remained high.
Following the move, soya oil and sunflower oil imports would be subject to an effective tax rate of 30.25%, from the original 38.5%, a net reduction rate of 8.25%, the report said.
“The import duty reduction is just up to 30 September, therefore it is unlikely to result in fresh aggressive purchases of CDSBO [soya oil] and CSFO [sunflower oil] from India,” Anilkumar Bagani, research head at Mumbai-based vegetable oil broker Sunvin Group, told AgriCensus.
“There would be some impact on nearby shipments, however, which are yet to be priced,” Bagani added.
The lower tax would bring more uncertainty as many importers had already paid duty, India-based broker Kumar Bromex told AgriCensus.
In an earlier effort to lower edible oil prices, the Indian government had lowered the import duty for palm oil (CPO) and refined palm oil (RBD) on 30 June, effective until 30 September, the report said.