The agri-cess for crude palm oil has been increased from 17.5 to 20 per cent
Government of India, vide Notification No. 42/2021- Customs, dated September 10, 2021, has further reduced the standard rate of duty on crude palm oil, crude soyabean oil and (i) crude sunflower oil to 2.5 per cent with an effect from 11.09.2021 and (ii) the standard rate of duty on refined palm oils, refined soybean oil and refined sunflower oil to 32.5 per cent with effect from 11.09.2021.
In the same notification, the agri-cess for crude palm oil has been increased from 17.5 per cent to 20 per cent.
It may be noted that the international prices and thereby domestic prices of edible oils have been ruling high during 2021-22 which is a cause of serious concern from inflation as well as consumer’s point of view. Import duty on edible oils is one of the important factors that impacted landed cost of edible oils and thereby domestic prices.
To mitigate the rise in these prices, the Government of India had taken series of steps between February 2021 and August 2021.
Some of them included-
1) Rationalisation of import duty
• The Government, Vide Notification No. 34/2021- Customs, dated June 29, 2021, has reduced the standard rate of duty on Crude Palm Oil to 10 per cent from 30.06.2021 and will have an effect up to September 30, 2021.
2) The Government, vide DGFT’s Notification No. 10/2015-2020 dated June 30, 2021, has amended the import policy of refined palm oils from ’restricted’ to ’free’ with immediate effect and for a period of up to 31.12.2021. Further, refined palm oils are not permitted through any port in Kerala.
3) The Government, Vide Notification No. 40/2021- Customs, August 19, 2021, has reduced the standard rate of duty on crude soybean oil and crude sunflower oil to 7.5 per cent and refined soybean oil and sunflower oil to 37.5 per cent with effect from 20.08.2021. It has been done through the amendments in the notification of the Government of India, in the Ministry of Finance (Department of Revenue) No. 34/2021-Customs, dated June 29, 2021.
4) Facilitation at the various port by Customs, FSSAI, PP&Q, DFPD and DoCA
5) To speed up clearances of consignments of imported edible oils delayed due to COVID-19, a Committee is in place comprising of Food Safety & Standards Authority of India (FSSAI), Plant Quarantine of the D/o Agriculture, Cooperation & Farmers Welfare, D/o Food and Public Distribution, D/o Consumer Affairs and Customs which reviews the consignments of imported edible oils on weekly basis and also apprises the Inter-Ministerial Committee on Agricultural Commodities chaired by Secretary (Food).
The Standard Operating Procedure for faster clearance of consignments of imports of edible oils has been prepared. The average dwell time for clearances of consignments has come down to 3.4 days in the case of edible oils.
The duty cuts already made amount to an estimated Rs 3500 crore in a full year. With the current/latest reduced import duty worth Rs 1100 crore in a full year, the total direct value of benefits expected to be passed on to the consumers, in terms of duties given up by the government, is Rs 4600 crore.
