malaysiang
KUALA LUMPUR, The adjustments in export tax under Budget 2025 will help the palm oil refining industry be more competitive, compared with Indonesia, according to Glenauk Economics.
The advisory firm said under the old export tax schedule, Indonesia has advantages over Malaysia in the downstream segment but the new export tax schedule in November would give Malaysia similar advantages.
Effective Nov 1, 2024, the revised Malaysian export duty schedule will include additional export taxes involving crude palm oil (CPO) prices of between RM3,601-RM3,750 per metric tonne that is subjected to an export duty rate of 8.5 per cent; followed by RM3,751-RM3,900 at 9.0 per cent; RM3,901-RM4,050 (9.5 per cent); and more than RM4,050 (10 per cent).
Glenauk Economics said the full implications of the adjustments would be analysed in its next monthly report. “In addition, as the taxes were not extended onto downstream products (such as stearin) it does not help the oleochemicals industry, which is struggling from increase
d competition on the export market from Indonesia where new capacity build-up has been extensive,” it said in a report today.
On Friday, the Ministry of Finance announced the export duty rates for CPO have been revised to ensure an adequate domestic supply of the commodity.
The move also aims to boost processing and downstream activities to produce higher value-added products such as biodiesel and oleochemicals.
According to an appendix released alongside the Budget 2025 presentation, the Ministry of Finance announced that the revised CPO export duty rates will take effect on Nov 1, 2024.
The existing export duty for CPO priced at RM2,250 per metric tonne and below will remain at zero per cent, followed by 3.0 per cent for prices between RM2,250 and RM2,400; 4.5 per cent for RM2,401-RM2,550; 5.5 per cent for RM2,551-RM2,700; and 5.5 per cent for RM2,701-RM2,850.
The rate will increase to 6.0 per cent for CPO priced between RM2,851 and RM3,000 and 6.5 per cent for prices between RM3,001 and RM3,150.
For
CPO priced between RM3,151 and RM3,300 per metric tonne, the export duty will be set at 7.0 per cent, followed by 7.5 per cent for RM3,301-RM3,450 and 8.0 per cent for RM3,451-RM3,600.
To further support the sustainability of the palm oil industry, the MOF proposed revising the windfall profit levy threshold to 3.0 per cent for both Peninsular Malaysia and Sabah and Sarawak.
The new threshold prices will be set at RM3,150 per metric tonne for Peninsular Malaysia and RM3,650 for Sabah and Sarawak, effective Jan 1, 2025.
Source: BERNAMA News Agency
