ISLAMABAD, Feb 7: Pakistan will review palm oil import duties in June whenthe budget for the next fiscal year will be announced, a finance ministryofficial said on Wednesday.
"We are not going to touch the existing duty structure until June," theofficial told Reuters. The agriculture ministry is lobbying for higherduties on palm oil imports to protect domestic crops such as cotton seed,canola and sunflower.
Malaysia has asked Pakistan to reduce the palm oil duty.
Pakistan currently charges a fixed Rs10,800 a ton as a regulatory andcustoms duty on palm oil imports, apart from a 15 per cent sales tax.
But the agriculture ministry wants a 15pc custom duty on the imported palmoil in addition to the 15 per cent sales tax.
The official said the existing rate of duty would continue until the nextfederal budget, when a decision would be taken whether to increase theduty or not.
"Upward revision will hamper the imports of palm oil and also revenuesprojected by the tax authorities for the fiscal 2000-2001, which we do notwant at this stage," he said.
In the current season, Pakistan produced 400,000 tons of cotton seed usedin edible oil and supplies are likely to be exhausted by the second weekof February.
But fresh supplies of canola and sunflower are likely to start enteringthe market in May and June.
The official said Pakistan was asking Malaysia to reduce export duty oncrude palm oil so the local value-added sector could be promoted. Inreturn Islamabad may reduce import duty on the palm oil, he said.
Pakistan imported crude palm oil worth Rs407m ($6.9m) during the lastfiscal year. Pakistan annually imports about 1.3 million tons of edibleoil products.