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KUALA LUMPUR: The government is expected to collect potential revenue of RM348 million from windfall tax on palm oil in 2020 compared to just RM256,000 in 2019 following the increase in crude palm oil (CPO) prices said the Ministry of Plantation Industries and Commodities. .
He said this was based on yield, price expectations and fresh fruit bunch production from the farms during 2020.
As a guide, he said the levy is imposed at a rate of three percent for palm oil prices that exceed 2,500 ringgit per ton on the peninsula and 1.5% for palm oil prices that exceed RM3,000 per ton in Sabah and Sarawak.
“Crude palm oil (CPO) prices are expected to continue to rise above RM3,000 per tonne, driven by positive market sentiment, expectations of declining stocks and rising exports as well as the world economic and political developments by the end of 2020, “said Minister Datuk. Dr. Mohd Khairuddin Aman Razali said in a statement Wednesday.
He said that in fact CPO prices have shown a significant upward trend, jumping to RM3,424 per tonne on November 6, 2020 compared to their lowest level of RM2,021.50 per tonne on May 12, 2020 , an increase of RM1,402.50 or 69.4 percent.
“In an effort to boost the development of the palm oil industry, the ministry is also studying the general tax and cessation structure in the plantation sector,” he said.
He said CPO prices and movement in the market were determined by the power of supply and demand, as well as basic factors and market sentiment.
Increasing CPO prices not only helped increase small farmers’ incomes as well as property, but also contributed to economic development for the country’s prosperity, he added. – Bernama
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