Monday, April 30, 2012

House rental tax drive to hit tenants hard

The government's drive to widen the house rent tax net that is starting from Wednesday is expected to hit the millions of tenants in the valley in absence of weak regulatory mechanism and lack of protection of their rights.
"A natural person will have to pay 10 per cent of the rent as tax," said Inland Revenue Department's director general Tank Mani Sharma here today.
Most of the commercial buildings have already come into the tax net — though reducing the rent to escape tax compliance is high among them — but residential houses are yet to come into the net, he said, adding that the department is planning to bring some 25,500 more houses across the country into the house rent tax net within this fiscal year. "For commercial buildings, the department is planning to bring floor price soon."
"The department is planning to bring some 20,500 more houses into the net in the Kathmandu Valley and the remaining from across the country."
However neither the department nor the Kathmandu metropolis has fixed any rent for the residential purpose that might push the rent up by 10 per cent as soon as the drive starts as the house owner will be responsible to pay the tax now onwards.
"In Kathmandu district, the department will start the House Rent Tax card distribution to the house owners from Wednesday," Sharma added.
"The 35 ward offices in Kathmandu metropolis and 13 tax payers service offices will help distribute the cards in Kathmandu district and two places each in Bhaktapur and Lalitpur will help distribute the cards in the valley whereas there will be around 100 places to distribute the cards across the country."
"The metropolis will start collecting all the data of the houses and maintain the database within the current fiscal year," said chief executive of Kathmandu metropolis Kedar Bahadur Adhikari. "The database will be shared with Inland Revenue Department making revenue mobilisation of both the department and metropolis easier," he said, adding that the drive will also boost the local tax mobilisation.
The department has already mobilised Rs 1.90 billion tax under house rent by the end of the ninth month of the current fiscal year that has set a target of Rs 1.35 billion.
"Kathmandu Metropolis alone houses over one million population," according to Population Census 2011 that has revealed that some 119 families live in some 100 houses across the country. But the ratio is higher in Kathmandu as it has seen a huge influx from outside the Valley not only for higher education but also for employment and security.
However, finance minister Barshaman Pun opined that the government needs to mobilise more resources to serve the rising expectation of the people. "The current resources are not enough even to meet the recurrent expenses," he said, adding that the government is trying to prepare the environment of making people aware of their responsibility towards the nation.
"A country can be sovereign only if it can mobilise its local resources," finance secretary Krishnahari Baskota said, adding that the widening of tax net is a must for the country to stand on its own without foreign aid.

Samsung surpasses Nokia to become world's largest handset maker

Samsung passed Nokia to become the world's biggest mobile phone maker
in the first quarter, according to Strategy Analytics.
The market researcher estimates that Samsung sold 93.5 million
handsets, versus a reported 82.7 million at Nokia. "Samsung took a
record 25.4 per cent of the market, up from 19.3 per cent a year ago,"
it reported, adding that Nokia fell to 22.5 per cent from 30.4 per
cent in the year-earlier period, ending its 14-year reign as the
world's biggest handset vendor.
Samsung was also the top smartphone seller in the quarter, passing
Apple to reach a 31 per cent market share. Samsung's smartphone sales
rose an estimated 253 per cent annually to 44.5 million, while Apple's
shipments of 31.5 million accounted for a market share of 24 per cent.
"On the total phone market, Apple had a share of 9.5 per cent, up from
5.2 a year ago," according to Strategy Analytics that estimated the
total mobile phone market expansion of three per cent year-on-year to
368 million units in the first quarter of 2012.
"It was led by a 41 per cent increase in global smartphone shipments
to an estimated 145 million units in the first quarter of 2012," the
researcher added.

Sunday, April 29, 2012

Tea producers seek soft loan facility

Tea producers have asked the central bank to help protect the Nepali tea sector.
"The tea sector is hit hard by the high interest charged by banks and financial institutions," Himalayan Orthodox Tea Producers Association's president Uday Chapagain told the central bank governor Dr Yubaraj Khatiwada today.
Unlike other industries, the tea sector requires 80 per cent investment on labour, is a traditional agro-based industry and weather dependent produce, he said, adding that they want soft loans at seven per cent interest which is a must to sustain the industry in the long run.
Apart from the lower interest rate, the tea producers also asked for simplified procedure to get cash incentives. "We want the cash incentives based on total exports earnings in foreign currency," said Nepal Tea Producers Association president Binay Goel.
Both the associations apprised the governor of the problems and challenges the tea producers are currently facing. "We also need Indian currency to import machinery from India," they said, adding that the central bank should introduce a policy that will facilitate them in exchanging some of the foreign currency they earn to Indian currency.
Answering the delegation, the governor said that the government is planning to bring a package for tea producers as it is one of the products that has competitive advantages. "But the government is discussing on whether to provide them incentives or subsidy," he said, adding that the government has given priority to the agriculture sector.
However, the government cannot provide subsidy to all and is thus thinking of risk minimisation to give agro products a more competitive edge, said Khatiwada, adding that the central bank recently brought the interest serving period in line with the crop cycle. "Similarly, from the next fiscal year, the interest rate will also come down," the governor added.
According to the central bank, the country has exported tea worth Rs 172.8 million to third countries in the first eight months of the current fiscal year which is more than double the exports worth Rs 74.4 million in the same period last fiscal year. "Similarly, in the same period of the fiscal year 2009-10, the country had exported tea worth Rs 60.7 million to third countries except India."

Power Grid completes 40MW transmission project to Nepal

With three key projects aimed at beefing up the power transmission capacity between India and Nepal achieving completion, an additional 40 MW of electricity transfer from India to the Nepal is expected to commence over the next couple of months.
The wrapping up of the projects by the Indian side — executed on the ground by India’s state-owned transmission major Power Grid Corporation — comes at a time when the country is working hard to set the ball rolling on its strategic initiative of putting in place a multilateral SAARC Market for Electricity (SAME) on the lines of the Nord Pool in the Scandinavian countries and the West African Power Pool.
Nepal is facing an electricity deficit of around 300 MW and currently draws around 50 MW from Bihar under a bilateral pact, along with some additional transfers from NHPC’s Tanakpur hydro station in Uttarakhand.
Extra power transfers from India would help Nepal in a big way to as the demand and supply gap could not be filled immediately with the ongoing hydro power projects.
Nepal has already, in principle, agreed to substantially ramp up power buys from India, with plans already underway to increase the power exchange volume to 200 MW by ramping up capacity between the two countries.
For the additional purchases, the Himalayan nation plans to tap the short-term electricity market window existing in India, including the two operational power exchanges, according to the decision taken at the Tenth meeting of the Indo-Nepal Power Exchange Committee held here in December 2011.
On the larger SAARC grid plan, while a transmission link with Bhutan is already in place, there are plans to augment the existing line to enable up to 5,000 MW of electricity imports into India by 2020. With Sri Lanka, plans are under way for setting up a $450-million undersea power transmission link.

Private sector to lead economic development

Federation of Nepalese Chambers of Commerce and Industry (FNCCI) and TiE-Global signed a memorandum of understanding (MoU) today to enhance bilateral cooperation for strong private sector with better access to technology, networking to tap into ideas to create employment and access to capital.
Both the organisations will work together for the economic development of the country and the partnership will help Nepal create employment, said president of FNCCI Suraj Vaidya, who signed the MoU with the charter member of TiE-Global and managing director of APCA Nikesh Sinha.
"TiE-Global and the federation will conduct training, share experiences and create employment opportunities through entrepreneurship and is even thinking of venture capital," he added.
TiE-Global has a global network including more than 57 branch offices and 600 members, said Sinha, adding that it will help Nepal in entrepreneurship, experience sharing, networking, investment, preservation of intellectual property, creation of employment opportunity and others.
He also urged to develop a culture that celebrates entrepreneurship. Similarly, US State Department special representative for commercial and business affairs Lorraine Hariton said that the country needs to create entrepreneurs to generate employment.
"The time is perfect as the peace process is coming to its logical conclusion," she said, adding that the private sector now has to lead for the economic development of the nation.
Hariton is leading a team from the US State Department on a five-day long visit with an aim to hold discussions with the government and private sector for the development of entrepreneurship and business.
She said that promotion of entrepreneurship will ensure sustainable development in the country. "It is very essential for sustainable development," said Hariton, adding that identification of real entrepreneurs, appropriate policy and laws, and access of entrepreneurs to the market are a must for the overall development of entrepreneurship.”
They also discussed on the role of the private sector, possibility of cooperation and the successful models of development.
"The positive investment climate has been created due to the current political development," said Vaidya, adding that the private sector is confident that the country will move towards the direction of economic growth and prosperity.
He also emphasised the need to cooperate with international partners to bring additional investment and new technology to promote the country’s economic sector.
The umbrella organisation of the private sector has been carrying different projects to create more employment opportunities in the country in collaboration with the government and donor agencies. It has played a vital role in promoting entrepreneurship by utilising its established network.

Saturday, April 28, 2012

Nepal lauds UN role on LDCs

Nepal hailed the United Nations (UN) role on Least Developed Countries (LDCs).
Addressing the closing plenary of the thirteenth United Nations Conference on Trade and Development (UNCTAD XIII) as the coordinator of the LDC Group, ambassador and permanent representative of Nepal to the United Nations Shanker D Bairagi, highlighted the important role the UN has been playing for the development of the least developed countries.
The successive UN conferences on LDCs have helped highlight their structural constraints and vulnerabilities and mobilise international support for their development, he added.
Referring to the last minute agreements on a number of contentious issues to be included in the outcome document of the Conference, Bairagi said that the consensus in Doha is the manifestation of the collective commitment of the international community to work for a better future for all, including the most impoverished and destitute. He stressed that as countries with widespread poverty and overall backwardness, the LDCs always attach high importance to development conferences and it was with this conviction they participated in the Conference.
The Ambassador thanked all delegations, including the development partners, for the flexibilities, understanding and accommodative spirit shown during the negotiation process, in particular on the needs and concerns of the LDCs.
He expressed hope that the Conference outcome will contribute meaningfully in the process of implementation of the Istanbul Programme of Action for the LDCs which envisions enabling half of the LDCs to reach the level of graduation from the LDC category by 2020.
The conference concluded in Doha, Qatar on Friday, adopting an outcome document termed the 'Doha Mandate'.

Friday, April 27, 2012

IOC to fix price on daily int'l price

Indian Oil Corporation (IOC) has agreed to the spot price mechanism which is expected to help fix price on the daily basis.
"IOC will fix petroleum price for Nepal Oil Corporation (NOC) on the basis of daily price of Platts/Argus — international petroleum organisation — and transportation cost to depots near the Nepal border,” said acting managing director of NOC Suresh Kumar Agrawal after the signing ceremony of the revised agreement on the supply of petroleum products between NOC and IOC here today.
The revised agreement will be in effect for the next five years till March 31, 2017. The earlier pact expired on March 31.
"IOC has also agreed to remove price adjustment tax applied in refinery margin and duty, which is almost two per cent,” he said, adding that the new provision will save around Rs 2 billion while importing petroleum products.
Likewise, IOC has also added Mumbai as a new petroleum import point for Nepal that would reduce petroleum cost transportation to mid-west and far-west region. Earlier, Haldia was the only import point.
The agreement has also stressed on maintaining quality of petroleum products. "There are sufficient provisions to control and regulate quality while importing and distributing petroleum products,” said Agrawal, adding that the construction of a pipeline from Raxaul to Amlekhgunj, and feasibility study of a pipeline for liquefied petroleum gas (LPG) also featured in the agreement.
The sole petroleum products supplier has granted one more import point for LPG — popularly known as cooking gas — including current refinery points Barauni, Haldia and Mathura. "Panipat has also been added,” he said.
However, the construction of a pipeline for petroleum products — petrol, diesel, kerosene and aviation fuel — was also in the earlier agreement signed five years back in 2007 but there has been no progress on the issue except for a detailed project study.
Similarly, the revised NOC-IOC petroleum supply agreement has also changed the payment system. According to the new agreement, NOC can pay the petroleum price to IOC a day later than the fixed date, if the prescribed day is a public holiday. "The agreement has included trade of bitumen, lubricants and grease between IOC and NOC," he said.
Likewise, IOC has promised to help build a competitive market price of petroleum products, said Agrawal, after signing the revised pact on behalf of NOC, whereas commercial general manager of IOC R Karandikar signed the pact on behalf of IOC.
Secretary of Ministry of Commerce and Supplies Lal Mani Joshi, high-level officials from NOC and IOC were also present at the agreement signing ceremony today.