FinMin to address tax confusion

Kathmandu, August 17

Minister of Finance Yubaraj Khatiwada has said that the ongoing confusion in the tax administration will soon be resolved.

Commenting on the public concern related to haphazard taxation on various goods and services by the provincial and
the local governments and complaints regarding double taxation, Minister Khatiwada informed that two separate
committees of the government have been formed to study the problems in the taxation system at the federal, provincial and the local levels.

“These committees will study the taxation issues being raised by the general public and the private sector, and will suggest the government for future approach to the taxation system,” he added.

Citing that the Constitution of Nepal and other legal documents have clearly discouraged double taxation and defined the rights and obligations of provincial and local governments in the tax administration, Khatiwada informed that imposing tax beyond the legal jurisdiction will be discouraged in coming days.

However, Finance Minister Khatiwada defended the need to tighten the taxation system due to lack of ample resources with the government. “Taxes should be imposed in such a manner that it does not negatively affect the people and businesses,” he added.

Meanwhile, Khatiwada stressed that all three layers of the government should be careful that the taxes, which have been collected, are utilised to improve public services and welfare of the society and country in an accountable manner.

Commenting on the concerns of sugarcane farmers not getting timely payment for their produce, Khatiwada said that the government’s decision to levy 30 per cent import duty on sugar will gradually reduce the influx of foreign sugar in the domestic market and create demand for Nepali sugar. “Along with falling sugar import, sugar mills in the country will be able to clear their stocks and issue all the payments due to sugarcane farmers by Dashain,” he added.

Beside these concerns, Minister Khatiwada said that the government is completely focusing on implementing the fiscal budget in an effective and efficient manner.

As per statistics of the Ministry of Finance (MoF), revenue collection has increased by 37 per cent in the first month (mid-July to mid-August) of the ongoing fiscal year 2018-19 to Rs 25.25 billion as compared to the same period in the last fiscal year. While the government’s current expenditure during the period stood at Rs 24.66 billion, its capital expenditure during the review period was Rs 1.32 billion.