Mozambique cooking oil producers panic over plastic bottle tax, could negatively affect the sector

MOZAMBIQUE – The Mozambique Cooking Oil Industry Association (AIOPA) has expressed fear that the recent tax on plastic containers introduced by the Mozambican government might have negative impacts on the sector that is still trying to establish itself.

This is following the introduction of a tax on plastic bottles at the beginning of this year focused on taxing plastic recipients used in the industrialization of cooking oil.

At its inception, the excise duty was aimed at discouraging the use of this material as it is harmful to the environment, charged per plastic bottle and other plastic products.

According to the duty imposed, for this year, 25 Mts will be charged for each kilo, in 2024, 27 Mts, and in 2025, 30 Mts, and the review will be done depending on the impact on the economy.

For AIOPA, the tax is heavy for the sector, since the government introduced it without taking into account the bottle of cooking oil.

“It negatively affects us as the margin of difference between the national and imported oil is 10 to 15 meticais (15 to 24 US cents) for a bottle of 300 milliliters”, said AIOPA representative, João Matlombe, stressing that currently, the industry is not getting value for production.

According to Matlombe, the cooking oil producers acknowledge the polluter-pays principle but they contest the tax “whereas the mineral water producers, who also use plastic bottles, are free from it

“But we know that the bottles of water pollute the consumer market, promoting garbage in the main urban centers”, AIOPA adding that, the government’s attitude contradicts the national industrialization strategy.

“We have been trying to talk to the government to abolish the tax but we do not hear good news. The government says that we must pay the tax in question and insist that the companies must resort to glass bottles to avoid the tax payment”, Matlombe said

In addition, the representative says that the tax on plastic changes the whole chain of oil production and could have implications for the consumer since there is a possibility to increase the price of oil to cater to the increased cost of production.

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