The Competition and Fair Trading Commission (CFTC) is investigating six local cooking oil manufacturers over the recent rise in prices of the commodity which they align to the reintroduction of 16.5 Value Added Tax (VAT).
CFTC Executive Director James Kaphale said this on Tuesday in Blantyre during media training on consumer protection and the commission’s mandate.
Kaphale said it is surprising that cooking oil prices have risen by more than 50 percent yet manufacturers blame the reintroduced VAT which is 16.5 percent.
“This is an issue that we did not receive a complaint on but we noticed it ourselves and launched an investigation which is now at an advanced stage. We will be releasing a report shortly to tell Malawians about our findings and, if any manufacturer will be found on the wrong side, they will be punished,” he said.
Data show that cooking oil prices skyrocketed between 50 to 70 percent since VAT was reintroduced in the 2020/21 national budget.
Capitol Oil Refining Industries Limited Executive Director Ameen Karim said during an interface between manufacturers, Consumers Association of Malawi (Cama) and Malawi Revenue Authority (MRA) representatives last month in Blantyre that as much as there are other factors leading to the rise, they are burdened by VAT which has pushed up the commodity’s price.
He added that they would continue lobbying government to consider removing the tax because their businesses may shut down.
“We will not relent, we will keep our dialogue on and fight on because this is our country. The last time government removed VAT, it took them seven years, so, we hope soon or later this government will listen to us as well,” he said.
Cama Executive Director John Kapito maintains that manufacturers have been giving people wrong information on the rise of cooking oil prices because VAT should not be the main reason but, rather, the rise in prices of crude oil and other factors.
Head of Corporate Affairs at MRA Steven Kapoloma also said in an earlier interview that VAT should not be the reason because VAT is paid by consumers not them.
Justin Mkweu is a fast growing reporter who currently works with Times Group on the business desk.
He is however flexible as he also writes about current affairs and national issues.