The government has cut 20 percent value-added tax (VAT) on soybean oil at production and consumer level till 30 June.
The National Board of Revenue (NBR) issued a circular regarding the VAT exemption Monday.
However, the existing 15 percent VAT on the import of edible oil remains unchanged, according to the circular signed by NBR Chairman Abu Hena Md Rahmatul Muneem.
Earlier, the Bangladesh Tariff Commission and the Ministry of Commerce have urged the NBR several times to withdraw VAT on edible oil import.
Commerce Minister Tipu Munshi briefed the reporters at a press conference on the occasion of World Consumer Rights Day in the Commerce Ministry conference room on Monday that the government would reduce the value-added tax (VAT) in three areas - import, production and consumption - to control the price of edible oil.
The VAT on imports will be reduced from 15 percent to 5 percent. Besides, 15 percent VAT at the production level and 5 percent at the consumer level will be completely withdrawn.
The Commerce Minister said that the National Board of Revenue (NBR) would issue a SRO (Statutory Regulatory Order) with the instructions for immediate implementation.
He said, “On the occasion of Ramadan, none of us should buy more quantity of products than necessary. If everyone buys and stores the surplus goods, then it is normal for the price of the product to go up. However, if anyone needs five liters of oil, we can't stop if he or she buys 10 liters. If everyone starts buying more on the occasion of Ramadan, there will be a shortage in the market.”
“We can't get into everyone's kitchen. However, I request you not to buy more products for the month of Ramadan,” he added.
Replying to a question, the Commerce Minister said, “At present we have sufficient stock of goods. The stock is adequate for the month of Ramadan. Hopefully, products can be purchased at earlier prices at this time.”
Highlighting the impact of the international market on oil prices, he said the Russia-Ukraine war had caused instability in the commodity market.
The price of oil has risen from $1350 to $1900 in the international market, he said, adding that we do not have the power to reduce oil prices in the international market.
Munshi said that in the Ramadan, the essential products will be distributed through TCB among one crore people across the country.
“We are trying to keep the previous price until Ramadan. But traders must do business. We have to be careful about this,” he added. Tapan Kanti Ghosh, Senior Secretary, Ministry of Commerce, and AHM Safiquzzaman, Director General (DG) of the Directorate of National Consumer Rights Protection (DNCRP) were also present at the briefing.