June 06, 2007	Wednesday	Jamadi-ul-Awwal 20, 1428

ISLAMABAD, June 5: The tax pundits in the Central Board of Revenue (CBR) and the association representing the edible ghee/oil industry are locked in a blame-game as consumers suffer due to persistent rise in prices of ghee and oil.

Talking to Dawn Pakistan Vanaspati Manufacturers Association (PVMA) deputy secretary Muhammad Iqbal on Tuesday stressed the need that the government should reduce customs duty, sales tax and withholding tax on imported edible oils in the upcoming budget to give some relief to consumers.

However, Adviser to the Prime Minister on Finance Dr Salman Shah has already rejected the demand of the association recently and reiterated that no reduction in duties and taxes on palm olien is being made in the budget 2007-08.

Consumers are facing the brunt of these divergent views as the average price of vegetable ghee (2.5 kg tin) reached to Rs257.65 on June 1, 2007 from Rs204 in December 2005, showing an increase of Rs53.65 or Rs21.46 per kg.

The price of vegetable ghee (loose) also witnessed an increase of Rs27.01 per kg to Rs85.76 per kg in June 1 this year from Rs58.75 in December 2005. Similarly, the price of cooking oil (2.5-litre tin) surged by Rs53.24 to Rs258.24 as compared to Rs205 in December 2005, an increase of RS21.296 per litre.

The PVMA deputy secretary said that the C&F price of imported palm olien had increased from $465 per ton in July 3, 2006 to $845 per ton on May 25, 2007.

As a result, the landed prices of RBD palm olien had increased by Rs28,623 per ton or say Rs28 per kg. Similarly, the FED/Sales Tax on RBD palm olien increased in May 25, 2007 to over Rs9,100 per ton and withholding tax to Rs2,000 per ton vis a vis FED/Sales Tax at Rs5,651 per ton and withholding tax Rs1,288 per ton in July 2006.

He said the C&F price of RBD palm olien had further shoot up on June 4, 2007 to $888 per ton and landed price and government price would also increase further accordingly.

On the other hand the government was getting additional revenue at the cost of consumers with increase in international prices because of increased rates of sales and withholding tax.

He further said that the PVAM hoped that any reduction in customs duty and sales tax should be for all stakeholders in edible oil industry as any deviation in this regard would adversely affect the entire vegetable ghee industry.