Bangladesh’s vegetable oil market is bracing for a price hike, as oil producers have announced an increase in prices due to the expiry of tax exemptions on 31 March.
From 1 April, the price of bottled soybean oil will increase by Tk18 per litre, while loose soybean oil will rise by Tk13 per litre.
Bangladesh Vegetable Oil Refiners and Vanaspati Manufacturers Association notified the government of their decision on 27 March, informing the Ministry of Commerce and the Bangladesh Trade and Tariff Commission.
This price hike comes as the government’s VAT and duty exemptions on edible oils, which were introduced to keep prices affordable ahead of Ramadan, are set to end.
As per the new price structure, bottled soybean oil, which was last priced at Tk175 per litre on 9 December, will now cost Tk193 per litre.
The price of a five-litre bottle will be set at Tk935.
Loose soybean and palm oil will now be priced at Tk170 per litre, up from Tk157.
The business community has warned that if the government does not extend the VAT relief, the cost of imports will increase, necessitating this price adjustment.
However, if the VAT exemption is extended, the price will remain the same.
The VAT relief was initially granted to ease the financial burden during Ramadan, but it will expire on 31 March.
Bangladesh Trade and Tariff Commission had recommended an extension of the duty exemptions until June to continue stabilising prices, but no decision has been made yet by the National Board of Revenue (NBR).
Shafiul Atahar, director of the TK Group, explained that from 1 April, the price adjustment reflects the need to incorporate the VAT costs into the retail prices, ensuring that the business remains sustainable amidst changing tax conditions.
