Recommendation to reduce duty on sunflower oil and canola oil in Bangladesh

04-Dec-2024 01:16 PM

The Bangladesh Trade and Tariff Commission (BTTC) has recommended reducing the import duties on sunflower oil and canola oil to help ensure the availability of a broader variety of edible oils in the domestic market.

Currently, sunflower oil and canola oil face high import duties—31% for crude sunflower oil, 32% for refined sunflower oil, 37% for crude canola oil, and 58% for refined canola oil.

In comparison, the import duties on soybean oil and palm oil are lower, which has led to an increase in the import of these oils.

The BTTC's recommendation is based on the idea that reducing the duties on sunflower and canola oils will provide consumers with more choices and encourage a more diverse supply of edible oils in Bangladesh, a country that relies heavily on imports to meet its domestic oil demand due to low local production.

Additionally, the Bangladesh government has recently reduced the value-added tax (VAT) on soybean oil and palm oil imports from 10% to 5%, effective until December 15, 2024. However, after this period, the VAT will return to 15% for crude palm oil and crude soybean oil, and 20% for refined soybean oil.

The high duties on sunflower oil and canola oil have raised concerns, as these oils are popular globally and have competitive potential in the market.

By lowering the duties on these oils, the BTTC believes it could help stabilize oil prices, broaden consumer choices, and improve the overall supply of edible oils.

This is particularly relevant as the country struggles with meeting its demand through imports, which is exacerbated by a lack of local production.