I & S INNOVATION & SUSTAINABILITY

A possible abolishment of a reduced VAT on palm oil will have an impact on consumers

23 July 2019

A possible abolishment of a reduced VAT on palm oil will have an impact on consumers

Published by: OilWorld

The Chairman of the State Duma Vyacheslav Volodin declared that introduction of a bill of abolishment of a reduced VAT on palm oil and return to the 20% rate was conformed on Wednesday. The bill is going to be introduced before the end of the spring session – its last plenary meeting will be 25 July.

Oleg Harlanov, Director of the Fat&Oil Division of EFKO Group, commented this initiative: «It’s quite difficult to understand the logic of this initiative. There is a resolution of RF Government on approval of a list of food products that are liable to the VAT at 10%. At the moment, this category includes the vast majority of products of the food industry including different types of vegetable oil. It’s absolutely logical that there is palm oil in this list. Therefore it isn’t clear on what grounds it’s proposed to remove this product from the list. Moreover, it’s unclear what the positive effect for the state is. In general, we suppose that it won’t influence on the situation in the Fat&Oil branch and related sectors», - Oleg Harlanov thinks.

According to the expert, realization of the initiative will, first of all, have an impact on the consumer of final products because most FMCG-products will become more expensive. «With existing in Russia tax system all additional expenses will be borne by ordinary consumers», - Oleg Harlanov believes.

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