KUALA LUMPUR – Umno information chief Shahril Hamdan has called on the government to use windfall tax from crude palm oil (CPO) export duties to subsidise the price of cooking oil in an effort to reduce the people’s burden during these trying times.
“The price of CPO had increased last year, and the price of unsubsidised cooking oil has also increased – a 5kg bottle cooking oil now costs more than RM30,” said Shahril.
“We know that the prices of cooking oil in bottles have not been subsidised by the government since 2016.”
He noted that when the CPO price surpassed RM2,500 per metric tonne in Peninsular Malaysia and RM3,000 per metric tonne in Sabah and Sarawak, the government collects CPO export duties and extraordinary profit taxes (windfall tax) from palm oil enterprises.
On May 8, Plantation Industries and Commodities Minister Datuk Mohd Khairuddin Aman Razali had said the government was expected to earn RM295 million in windfall tax in the first three months of this year, with CPO prices rising above RM2,500 a tonne.
His ministry estimated that the government will collect an even bigger windfall profit levy for the three months that follow should CPO prices, which would surpass RM4,000 per tonne, remain at that level.
If it remains high throughout the year, the government is expected to collect more than RM1 billion this year.
Shahril stressed that this revenue does not include corporate income taxes collected from large palm oil companies.
“This excess income from the ‘windfall tax’ is enough for the government to cover the expenses related to the burden of citizens who have to endure the increased price of cooking oil,” he said.
He also suggested that the government implement cooking oil subsidy programmes that are aimed towards B40 and M40 households in accordance with existing Bantuan Prihatin Rakyat (BPR) data under the Inland Revenue Board.
If that option is not accepted, he suggests that BPR cash assistance be given to B40 and M40 groups.
“The amount announced in the Pemerkasa Plus programme is not enough and has been reviewed by many parties,” Shahril added.
He further suggested the government add the 1kg cooking oil subsidy quota to what is already provided under the Cooking Oil Stabilisation Scheme.
He said while the increase in CPO prices would benefit producers, including Felda settlers and small farmers, the main beneficiaries of the increased profits are big manufacturers and companies who can be subject to windfall taxes. – The Vibes, June 11, 2021
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