Import Duty Cut by 7.5% on Soyabean Oil and Sunflower Oil

· Crude – 7.5% from 15%; Edible Oil -37.5% from 45%

· Concession Valid upto 30 Sept 2021

India has cut base import taxes on crude and refined soyoil and sunflower oil to 7.5% from 15% for six weeks, a government order showed, as the world's biggest vegetable oil buyer tries to cool near record high prices.

The tax reduction could increase imports of soyoil and sunflower oil in September, although a big jump is unlikely as the lower duty is only applicable for a short period until Sept. 30, industry officials said.

"Logistically it is not feasible to sign contracts now and ensure vessels are unloaded at Indian ports before September end," Sandeep Bajoria, chief executive of Sunvin Group, a vegetable oil broker, said.

India buys soyoil and sunflower oil mainly from Argentina, Brazil, Ukraine and Russia.

Refiners might divert two to three vessels heading to other destinations such as China towards India to in cash lower duty, said Bajoria.

India fulfils more than two-thirds of its edible oil demand through imports and has been struggling to contain a rally in local oil prices for the last few months. It had cut import tax on crude palm oil on June 29.

"Import tax on soyoil and sunflower oil was higher than palm oil. With this duty cut, there is parity on the import tax front now," said B.V. Mehta, executive director of the Solvent Extractors Association of India.

After the tax reduction, soyoil and sunflower oil imports will be subject to a 30.25% tax in total, including 7.5% base import duty and other taxes.

The government may restore higher duty structure from October, when supplies of summer-sown oilseeds would start, said a Mumbai-based dealer with a global trading firm.

"Soybean and ground nut supplies would start from October. Government will try to ensure farmers will receive higher prices," the dealer said.

[Notification No. 40/2021-Customs dated 19 August, 2021

G .S.R. (E). - In exercise of the powers conferred by sub-section (J) of section 25 of the Customs Act, I962 (52 of 1962), the Central Government, on being satisfied that it is necessary in the public interest so to do, hereby makes the following amendments in the notification of the Government of India, in the Ministry of Finance (Department of Revenue). No. 34/2021-Customs, dated the 29th June, 2021, published in the Gazette of India. Extraordinary, Part II, Section 3, Sub-section (i), vide number G.S. R. 449(E), dated the 29th June, 2021 , namely:-

In the said notification, -

in the Table, after S.No.2 and the entries relating thereto, the following S.No. and entries shall be inserted, with effect from 20th August, 2021, namely:

(1)	(2)	(3)	(4)
“3.	1507 10 00	All goods	7.5%
4.	1507 90 10	All goods	37.5%
5.	1512 11 10	All goods	7.5%
6.	1512 19 10	All goods	37.5%

[F.No. CBIC-190354/ 166/2021-TO(TRU-I)-CBEC)