Kitchen oil to get cheaper: Govt slashes duty on palm, soybean and sunflower oil

The government has slashed import duties on crude sunflower, soybean, and palm oils from 20% to 10%. This move is expected to bring down cooking oil prices and provide relief to consumers.

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Cooking oil prices to decrease!

Recently, cooking oil prices have skyrocketed, making it difficult for ordinary people to manage household expenses. The government's import duty hike in September 2024 and the subsequent rise in international oil prices are seen as contributing factors.

This has significantly increased the cost of everyday cooking oil, adding a burden to every family's budget. Now, the central government has announced significant relief for the common people. 

It has reduced the basic customs duty on crude sunflower, soybean, and palm oils from 20% to 10%. This has widened the tax difference between crude and refined oil from 8.75% to 19.25%.

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Why were duties reduced?

Over the past few months, oil prices have been rising uncontrollably. In September 2024, the government increased import duties to boost the domestic oil industry. However, this backfired as international oil prices also rose, further increasing prices in India.

This led to a surge in household cooking expenses, making even buying a bottle of oil a matter of careful consideration. Now, the government has taken a new decision. The reduction in customs duties on crude oils is expected to lower oil prices, directly benefiting the public.

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What's the impact of the increased tax difference?

Crude cooking oil is unrefined, while refined oil is ready for cooking. Previously, the customs duty difference between the two was 8.75%, leading to higher imports of refined oils. Now, with the difference at 19.25%, importing refined oils becomes more expensive.

This encourages oil companies to import crude oil and refine it in India, boosting the domestic refining industry with jobs, growth, and interim relief. This change may also lower refined oil prices, directly benefiting consumers.

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How will the public benefit?

The government has clearly stated that the full benefit of this duty reduction should reach the people. Food oil companies and stakeholders have been advised to reduce prices accordingly.

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Will prices actually decrease?

That's the question everyone's asking. The government has reduced duties, but will oil companies pass on the benefits? In many cases, companies have pocketed such benefits without lowering prices. However, this time, the government has issued a strict order to reduce prices. This move is expected to increase market competition and lead to actual price reductions, providing real relief to ordinary people.