Govt looks to food in continued relief plan

Edible oil is set to get 10% tax relief in light of import bill

Only a few weeks after bringing down fuel prices by Rs 10 as part of an economic relief package, the federal government is now also trying to bring down the prices of edible oil by reducing taxation on it. 

The federal government has approved tax relief of 10 per cent on import of edible oil for April and May 2022, this was decided in a meeting held under Federal Minister for Finance and Revenue Shaukat Tarin on Friday.

The finance minister was apprised that monthly average retail prices of RBD palm oil are highly volatile and have increased almost twice compared with last year. In order to deal with the expected shortfall in the month of Ramzan due to a hike in prices, the finance minister approved tax relief of 10 per cent on import of edible oil for April and May 2022.

Edible oil consumption in Pakistan has increased significantly over the last few decades: from 0.7 to 4.7 million tonnes between 1981 and 2020.People no longer rely solely on ghee or butter for their cooking needs. As the nation develops, the introduction of cooking oil and it becoming mainstream has helped push remands. Other main demand drivers are rising population, dietary preferences and increase in per capita income.

Why is this important?

Pakistan’s reliance on imports for edible oil and oilseed meals to meet domestic demand consumption has been increasing over the past two decades: 86 percent of domestic edible oil consumption in 2020 came from imports up from 77 percent in 2000.

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Ariba Shahid
Ariba Shahid
The author is a business journalist at Profit. She can be reached at [email protected] or at twitter.com/AribaShahid

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