Edible oil prices likely to go up by Rs13-18 per kg from 1st

PVMA writes letter to PM, finance minister informing them of the situation in advance

ISLAMABAD:

Amid high inflationary pressure, the prices of edible oil are likely to increase by Rs13 to Rs18 per kg from July 1.

The Pakistan Vanaspati Manufacturers Association (PVMA) has written a letter to Prime Minister Imran Khan and Finance Minister Shuakat Tarin informing them of the situation in advance.

According to details, the reason for the increase in edible oil prices is the new taxes in the Finance Bill 2021-22.

The association has warned that if the taxes were not withdrawn, the prices of ghee and other types of edible oil would increase by Rs13 to Rs18 per kg from July 1.

The PVMA’s proposals were also presented to the finance committee, which had directed the association to resolve the matter with finance ministry officials.

However, the PVMA’s meeting with the finance secretary turned out to be of no avail, compelling the association to write a letter to the prime minister and finance minister.

Recently, Finance Minister Shaukat Tarin had directed the industries and production ministry to hold a meeting with ghee and edible oil manufacturers and help transmit the declining trend of international oil prices to end consumers.

Read Traders irked over inclusion of edible oil in Sales Tax Act

The minister was chairing a meeting of the National Price Monitoring Committee (NPMC) to review the prices of essential food items.

The per kilogram and per litre price of branded ghee and cooking oil respectively are between Rs320 and 330, while that of unbranded category range from Rs270 and Rs320.

Tarin highlighted that prices of palm oil and soybean were on declining trend in the international market but its impact on the domestic market so far had not been observed.

Apart from the edible oil, the government has also proposed in the Finance Bill to increase the General Sales Tax rate from 10% to 17% on yogurt, cheese, butter, milk cream, tea whitener, and flavoured milk.

This will push the cost of these dairy products in the range of 7% to 10%, resulting into additional payment of Rs5 billion by largely people living in cities that use these packaged food, said an official working in the dairy sector.

The government’s decision to change the tax regime was contrary to the understanding given to the Pakistan Dairy Association at a higher political level that also had the support of the economic ministers.

The assurance had been given on May 29 during a meeting chaired by the finance minister. The meeting had been attended by Hammad Azhar, Khusro Bakhtiar, Dr Ishrat Husain and Razak Dawood.

The dairy sector had demanded the government to exempt its products from 10% GST and declare it a zero rating sector for three years on a trial basis.