Press Information Bureau

Government of India

Cabinet Committee on Economic Affairs (CCEA)

17-January-2013 13:54 IST

The Cabinet Committee on Economic Affairs has approved to defreeze the tariff values of all edible oils, Palm Oil - Crude; Palm Oil - RBD (Refined Bleached Deoderized); Palm Oil - others; Palmolein - Crude; Palmolein - others; and Soyabean Oil - Crude and notify their tariff values on the basis of their prevailing international prices.

An alignment of notified tariff values with international prices will have a positive impact on the duty collected from import of edible oils and will provide an even-field to the domestic refining industry.

Background:

Tariff value is fixed under Section 14 (2) of the Customs Act, 1962, inter alia, on the above edible oils and notified on a fortnightly basis. Since 31.7.2006, tariff values of edible oils have remained unchanged, as a fiscal measure to contain inflation. The freeze has led to a significant variation between the notified tariff values and the computed landed prices based on international prices of the edible oils, adversely affecting the revenue collection and also the domestic refining industry. Hence, it is proposed to align the tariff values with international prices of the edible oils.

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SC/SK

Tariff value alignment: notified edible oil tariff values to be defrozen and linked to international prices. Approval was given to defreeze and re notify tariff values for specified palm and soybean edible oils so that notified values are aligned with prevailing international prices. Tariff values are fixed under Section 14(2) of the Customs Act, 1962 and notified fortnightly. The previous freeze since 2006 caused divergence from internationally computed landed prices, adversely affecting import duty revenue and the competitiveness of the domestic refining industry; aligning values with international prices is intended to redress those effects.