KARACHI, June 17: The price of a 16 kg vegetable ghee tin went up by more than Rs 50 on Monday as an immediate impact of the levy of 15 per cent general sales tax (GST) on ghee and cooking oil at the factory level coupled with five per cent rise in GST on edible oil at customs stage in the new fiscal.

The 16 kg Kissan ghee tin is now available at Rs800-810 as compared to Rs750-755 while shopkeepers are charging Rs755-760 for Hilal ghee tin as against its old price of Rs700. Resham ghee brand now sells at Rs760 as compared to Rs710, retailers of various areas said.

The sudden impact of GST came in the wake of increase in palm oil prices that went up to Rs1,610 per 40 kg from pre-budget price of Rs1,550.

Prices of ghee and cooking oil, produced by leading branded makers, are yet to witness any upward price spiral but some packers, interviewed by Dawn, said that the price increase will range 15-35 per tin of 2.5 to 5 litres.

The price of leading brand ghee, currently selling at Rs345, is expected to hover between Rs360-375, market sources said.

The Member, Managing Committee, Pakistan Vanaspati Manufacturers Association (PVMA), Nizar Ali said that the prices of ghee and cooking, produced by leading packers, may go up by Rs6-7 per kg on five litre tin.

He said the government is pressurising the packers to start implementing the GST with immediate effect as against the PVMA’s earlier demand of charging the new rate of GST from July 1, 2002.

Meanwhile, retailers told Dawn that the distributors of various leading brands have informed them on Monday that the next supplies in the markets will carry new price tags. Retailers said that the distributors of ghee and cooking oil packers have also suspended the supplies.

Local manufacturers are now in a fix whether they would pass on the full impact of the GST to the consumers or increase the prices in phases as any phenomenal price surge may affect their sales, and consumers will not be able to bear additional price burden.

On Monday, executives of various ghee producing companies were busy in calculating the real impact on the prices since the government has desired to see the implementation of the GST with immediate effect.

“We are analyzing the impact of GST both from consumer as well as market point of view,” an executive of a leading company said adding that the companies may not pass on the full impact of the GST to the consumers as it will hurt the end users very badly as well as affecting sales.