New Delhi: The finance ministry has extended the concessional basic customs duty and agriculture and infrastructure development cess applicable on edible oils by six months till the end of March 2023, an official order showed.
The government had in October 2021 announced concessional import duty on crude soybean oil, crude palm oil and crude sunflower oil till March 2022, which was once extended till the end of September. According to the order, now it has been again extended till next March.
The government in February also allowed exemption from agriculture and infrastructure development cess on imported lentils till September, which was later extended in July till March 2023.
The reduction in basic customs duty and cess was offered to provide relief to consumers as edible oil prices rose in world markets.
Accordingly, in addition to the concessional basic customs duty for soybean oil, sunflower oil and palm oil announced in October 2021, 5% concessional cess on crude palm oil and exemption from cess on pulses will continue till March. Edible oils in the ‘crude’ category are exempted from customs duty overall, while the refined category attracts 17.5 per cent customs duty.
The Consumer Price Index-based inflation data for July showed that the oil and fat category witnessed 7.5% inflation in July. Official data shows that food inflation stood at 6.75% in July, as against 3.96% in the same month a year ago.
“The Central Board of Indirect Taxes and Customs had reduced basic customs duty and agriculture and infrastructure development cess on palm oil and soybean oil in October 2021 to tackle inflation. This concession was initially valid till 31 March 2022 and was extended till 30 September 2022. The government has extended this concession till March 31, 2023 which will help in reducing the prices of edible oils,” explained Saurabh Agarwal, Tax Partner, EY.
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