World Bank downgrades Nepal growth forecast to 4.5 per cent

The World Bank (WB) has downgraded the growth fore cast to 4.5 per cent in the fiscal year 2024-25, due to damage from floods and landslides, and to 5.2 per cent in the fiscal year 2025-26, as a result of persistent weakness in the financial system.

Amid increasing uncertainty in the global economy, South Asia’s growth prospects have weakened, with projections downgraded in most countries in the region, not only Nepal. Stepping up domestic revenue mobilization could help the region strengthen fragile fiscal positions and increase resilience against future shocks, says the World Bank in its twice-yearly regional outlook.

Likewise, Afghanistan economy is estimated to have grown by 2.5 per cent in the fiscal year 2024-25, slower than the pace of population growth and growth is forecast to increase only moderately to 2.2 per cent in 2025-26, whereas Bangladesh growth is expected to slow in the fiscal year 2024-25 to 3.3 per cent amid political uncertainty and persistent financial challenges, and the growth rebound in the fiscal year 2025-26 has been also downgraded to 4.9 per cent.

The World Bank has also downgraded the growth forecast of Bhutan to 6.6 per cent due to weak agriculture sector growth but upgraded in the next fiscal year to pick to 7.6 per cent due to expected strength in hydropower construction. 

Indian growth story is also expected to slow from 6.5 per cent to 6.3 per cent as in the next fiscal year, as the benefits to private investment from monetary easing and regulatory streamlining are expected to be offset by global economic weakness and policy uncertainty, whereas the completion of a new airport terminal in Maldives will contribute to 5.7 per cent growth in 2025, although challenges in meeting external debt obligations continue to pose a downside risk, according to the World Bank.

In Pakistan, the economy continues to recover from a combination of natural disasters, external pressures, and inflation, and is expected grow by 2.7 per cent in the fiscal year 2024-25 and 3.1 per cent in the next fiscal year.

The Sri Lankan government has made further progress with debt restructuring, and a projected rebound in investment and external demand is expected to lift growth in 2025 to 3.5 per cent before it returns to 3.1 per cent in 2026.

Released today, the latest South Asia Development Update, Taxing Times, projects regional growth to slow to 5.8 per cent in 2025—0.4 percentage points below October projections—before ticking up to 6.1 per cent in 2026. This outlook is subject to heightened risks, including from a highly uncertain global landscape, combined with domestic vulnerabilities including constrained fiscal space.

“Multiple shocks over the past decade have left South Asian countries with limited buffers to withstand an increasingly challenging global environment,” said World Bank Vice President for South Asia Martin Raiser. “The region needs targeted reforms to address vulnerabilities such as fragile fiscal positions, backward agricultural sectors, and the impact of climate related shocks.”

Although tax rates in South Asia are often above the average in developing economies, most tax revenues are lower. On average during 2019–23, government revenues in South Asia totaled 18 percent of GDP—below the 24 percent of GDP average for other developing economies. Revenue shortfalls are particularly pronounced for consumption taxes but are also sizable for corporate and personal income taxes.

Tax revenues in South Asia are estimated to be 1 to 7 percentage points of GDP below their potential, based on existing tax rates, the report reads, adding that some of this shortfall is explained by the widespread informality and large agricultural sectors in the region. "However, even after taking this into account, sizable tax gaps remain, highlighting the need for improved tax policy and administration."

“Low revenues are at the root of South Asia’s fiscal fragility and could threaten macroeconomic stability, especially in times of elevated uncertainty,” said World Bank Chief Economist for South Asia Franziska Ohnsorge. “South Asian tax rates are relatively high, but collection is weak, leaving those who pay taxes with high burdens and governments with insufficient funds to improve basic services.”

The report recommends a range of policies to improve tax revenues by eliminating loopholes, streamlining tax codes, tightening enforcement, and facilitating tax compliance. This includes paring back tax exemptions; simplifying and unifying the tax regime to reduce incentives to operate in the informal sector; and using digital technology to identify taxpayers and facilitate collection. The report notes the potential of adopting pollution pricing, which could help address the high levels of air and water pollution while raising government revenues.

गिरिजाप्रसाद कोइरालाः बिजनेस फ्रेन्डली प्राइम मिनिस्टर

‘गिरिजाप्रसाद कोइराला…, गिरिजा प्रसाद कोइराला, विदआउट सेकेन्ड थट ।’ ‘लिक्वर किङ्ग’ अर्थात् जाउलाखेल ग्रुप अफ इन्डष्ट्रीजका संस्थापक अध्यक्ष विजय कुमार साहलाई सरकारले गत आर्थिक वर्षमा ब्यक्तिगततर्फ सबैभन्दा बढी कर तिरे वापत सम्मान गरेको छेकोमा उनीसँग क्लिकमान्डुले सोधेको थियो, ‘सबैभन्दा निजीक्षेत्रमैत्री प्रधानमन्त्री को हो ?’

साहले एक सेकेन्ड पनि नसोचि जवाफ दिए, ‘गिरिजाप्रसाद कोइराला…, गिरिजा प्रसाद कोइराला, विदआउट सेकेन्ड थट ।’

सरकारलाई सबैभन्दा बढी आयकर तिर्ने व्यक्तिमा विजयकुमार साहले सिद्धार्थ राणालाई पछ्याइरहेका छन् । अहिलेसम्म राणाले सबैभन्दा धेरै व्यक्तिगत आयकर तिरेको भन्दै ७ पटक सम्मानित भइसकेका छन् भने साहलाई सरकारले ३ पटक सम्मान गरेको छ ।

नेपालमा पनि पारदर्शीरुपमा उद्यम गरेर एउटा सफल उद्यमी हुन् अनि सरकारलाई कर बुझाएर गर्व गर्नसक्ने वातावरण बनाउन नि:सन्देहरुपमा गिरिजाप्रसाद कोइरालाको ठूलो भूमिका छ ।

त्यसैले पनि पुराना उद्यमीहरुले गिरिजा प्रसाद कोइरालालाई सम्झिरहन्छन् ।

‘अहो, गिरिजाबाबु त असाध्यै कचकच गर्ने, गाली गर्ने, यो के हो, यो सम्झा, त्यो बता भनेर केरकार गर्ने,’ साह भन्छन्, ‘एक चोटी बुझ्यो भने त्यो त अटल महाशक्ति तपाईंको पछि लाग्ने । उनले हामीलाई बोलाउँथे, तिम्रो के समस्या छ भनेर सोध्थे । घुस वा चन्दा कहिल्यै मागेनन् ।’

साहको विचारमा २०४६ सालको परिवर्तनपछि बनेको नेपाली कांग्रेसको सरकारले लाइसेन्सराज अन्त्य गरेका कारण नै निजी क्षेत्रले फस्टाउने मौका पाएको हो । र यसरी पारदर्शीरुपमा उद्यमीले कर तिर्ने तथा कर तिरे वापत सम्मान पाउने वातावरण बनेको हो ।

‘लाइसेन्सराज अन्त्य गर्नु एकदमै उत्कृष्ट काम थियो,’ साह भन्छन्, ‘त्यो बेलाको नेपालको आर्थिक विकास ‘मेटाफोरिक’ छ । बिजनेस गर्न पनि सजिलो थियो । तर, अहिले त उद्योग गर्नुभन्दा अगाडि कैयौंपटक सोच्छौं हामी ।’

निजी क्षेत्रलाई असाध्यै माया गर्ने प्रधानमन्त्रीका रुपमा गिरिजाप्रसाद कोइराला पहिलो नम्बरमा रहेको बताउँछन् अर्का व्यवसायी जितबहादुर श्रेष्ठ । नेपालमा निजी क्षेत्रबाट पहिलो हाइड्रोपावर निर्माण गर्ने श्रेष्ठका नजरमा गिरिजा नै त्यस्तो प्रधानमन्त्री हुन् जसले विनास्वार्थ निजी क्षेत्रका कुरा सुन्थे र काम गर्थे ।

कुनै बेलाका निकै ठूलो व्यापारिक घराना थियो एनबी ग्रुप । त्यसका सञ्चालक थिए जितबहादुर ।

‘मैले धेरै प्रधानमन्त्रीहरुसँग संगत गरेँ तर गिरिजाबाबु जस्तो निजी क्षेत्रका लागि सहज अरु कोहि पनि भेटिनँ,’ श्रेष्ठ भन्छन्- ‘उहाँ एकपटक कुरा बुझेपछि निस्वार्थ सहयोग गरिरहनुहुन्थ्यो । निजी क्षेत्रको विकास भयो भने मात्रै देश सम्मृद्ध बन्छ भन्ने उहाँको सोचाइ थियो । अहिलेका प्रधानमन्त्रीहरु त मलाई के फाइदा हुन्छ भनेर पहिल्यै सोध्छन् ।’

यसरी, नेपाली निजी क्षेत्रलाई फस्टाउने अवसर सिर्जना गर्ने र ‘मेटाफोरिक’ आर्थिक विकासमा भूमिका खेल्ने गिरिजाप्रसाद कोइराला आफैं भने कुनै अर्थविद् थिएनन्, उनी नेपालका अन्य प्रधानमन्त्रीझैं विशुद्ध राजनीतिज्ञ थिए ।

‘तर, उनी विश्व परिस्थिति बुझेका र परिवर्तन स्वीकार गर्न सक्ने प्रधानमन्त्री थिए,’ कोइरालाको मन्त्रिपरिषद्का अर्थराज्यमन्त्री तथा लाइसेन्सराज अन्त्य गर्ने एक सारथी महेश आचार्य सम्झन्छन् ।

गिरिजा नेतृत्वको पहिलो सरकारमा अर्थराज्यमन्त्री बनेका आचार्य २०५६ सालमा कृष्णप्रसाद भट्टराईको सरकारमा अर्थमन्त्री थिए । आचार्यको भनाइमा एकपल्ट कन्भिन्स भएपछि कोइराला मन्त्रीहरुलाई स्वतन्त्रतापूर्वक काम गर्न दिन्थे, हस्तक्षेप गर्दैनथे । ‘त्यसैले कामको परिणाम पनि देखिन्थ्यो र देखियो पनि ।’

‘गिरिजाप्रसाद कोइरालामा एडेप्टीबिलिटी थियो,’ उनी भन्छन्, ‘विश्व परिवेश परिवर्तन हुँदै थियो । उदारवादको वैश्विक परिवर्तनलाई एडप्ट गर्नसक्ने आँट उनमा थियो ।’

त्यसैले, आज पनि उद्यमीहरु नेपाली कांग्रेसका पूर्वसभापति तथा नेपालका पूर्वप्रधानमन्त्री गिरिजाप्रसाद कोइरालालाई सम्झिरहन्छन् ।

त्यसमाथि नेपाली कांग्रेसको एकमना सरकार भएका कारण प्रधानमन्त्री कोइरालाले जिम्मेवारी लिइदिएका कारण उदारवादलाई संस्थागत गर्न पनि सहज भएको आचार्य बताउँछन् । उनका अनुसार प्रधानमन्त्री कोइराला अनुकुल नभइदिएको भए उदारवादलाई संस्थागत गर्न गारो हुन्थ्यो ।

फर्काउला त बिराटनगरले गुमाएको औद्योगिक र राजनीतिक साख ?

पंचायत कालको बन्द अर्थतन्त्रमा सरकारले नै उद्योगधन्दा चलाउने प्रचलन थियो । त्यसबाहेक केहि छिटपुट उद्योग निजी क्षेत्रका थिए । तर, त्यसको लागि लाइसेन्स लिनु पर्थ्यो । लाइसेन्सराजका कारण अर्थतन्त्र घिसिपिटिरुपमा चलिरहेको थियो ।

पूर्वसोभियत संघकालीन अर्थतन्त्रको अवशेष सरकारी संस्थानहरु सबै घाटामा थिए । ती संस्थानले नागरिकले तिरेका कर राजश्व चाहि तलब र भत्ताको रुपमा खान्थे तर तिनीहरुको उत्पादकत्व भने थिएन । राज्यलाई भार मात्र भएका थिए ।

तर, २०४८ सालको प्रधानमन्त्री गिरिजाप्रसाद कोइराला र अर्थराज्यमन्त्री महेश आचार्य रहेको सरकारले बोझ बनेका सरकारी संस्थानलाई निजीकरणमा लगिदियो । लाइसेन्सराजलाई अन्त्य गरिदियो ।

यसो गर्दा दुइवटा काम एकैपटक भयो, एकः सरकारको दायित्व रहेन, अर्कोः निजी क्षेत्रले काम गर्ने भयो । नियामक निकायहरुलाई तत्काल बलियो बनाउन नसक्दा तथा केहि संस्थानको निजीकरणको प्रकृयामा त्रुटी भएका कारण विकृती आएपनि कोइराला सरकारको निजीकरणको नीति समायानुकुल थियो ।

आर्थिक उदारीकरण र निजीकरणपछि नेपालको आर्थिक वृद्धि राम्रो भएको तथ्यांकबाट नै स्पष्ट हुन्छ । नेपालको इतिहासमा आजसम्म सबैभन्दा बढी आर्थिक वृद्धि भएको दशक नै आर्थिक उदारीकरणको दशकमात्रै हो ।

त्यतिमात्र होइन आजसम्मको सबैभन्दा सफल आवधिक योजना पनि आठौँ पञ्चवर्षीय योजना मात्र हो । जुन आर्थिक उदारीकरणकै समयको हो ।

यो कुरा तथ्यांकले सिद्ध गर्छ ।

२०४७ सालमा नेपालको अर्थतन्त्रको आकार ४ खर्ब हाराहारी मात्र थियो । पंचालयकालीन बन्द अर्थतन्त्रका कारण २०४६/४७ सालसम्म सिमीत सरकारी रोजगारी मात्र थियो, अनि आर्थिक बृद्धिदर पनि ३ प्रतिशतदेखि ४ प्रतिशतको हाराहारीमात्रै थियो ।

तर, गिरिजा सरकारले लाइसेन्सराज अन्त्य गर्दै आर्थिक उदारीकरणको नीति ल्याएका कारण २०४८ देखि धेरै उद्योग कल कारखाना खुले । शिक्षा, स्वास्थ्य, बिमा, वित्त, वायुसेवा, जलस्रोतजस्ता विभिन्न आर्थिक सामाजिक क्षेत्रमा निजी क्षेत्रको सकृय सहभागिता बढ्यो । विभिन्न क्षेत्रलाई खुला गर्दा ती क्षेत्रमा काम गर्ने जनशक्तिको आवश्यकता पूर्ती गर्न काठमाडौँ विश्वविद्यालय, इन्जिनियरिङ तथा मेडिकल कलेज पनि खुले । शिक्षाको स्तर पनि बढ्यो । प्रसस्त उद्योग खुलेका कारण निजी क्षेत्रले पनि धेरै रोजगारी सिर्जना गर्यो ।

यस्तै, विकास निर्माणमा जोड दिन गाउँका पूर्वाधारमा धेरै बजेट पठाउने काम पनि २०४८ सालमा गिरीजाप्रसाद कोइराला प्रधानमन्त्री बनेपछि भयो । यसबाट गाउँमा पनि पनि आर्थिक गतिबिधि बढे । त्यसले अर्थतन्त्र चलायमान बनायो । सरकारको राजश्वको आधार पनि बढायो ।

तर, भारतको बिहार सहरसा जिल्लाको टेडी गाउँमा बि‍‍.सं. १९८१ असार १८ मा जन्मेका गिरिजाप्रसाद कोइरालाको शताब्दी जन्मजयन्ती मनाउँदै गर्दा सदैव उनको राजनीतिक पाटोको बारेमा मात्रै बढि चर्चा हुने गरेको छ । उनको नेतृत्वमा भएको आर्थिक उदारीकरणका कारण भएको आर्थिक विकासको बारेमा कमै मात्र चर्चा गरिन्छ ।

कहिँ कतै चर्चा गरे पनि गिरीजाप्रसाद कोइराला, महेश आचार्य अनि डा रामशरण महतले नेपालका उद्योग कलकारखाना बेचेर खाए भन्ने जस्ता भ्रमपूर्ण चर्चा मात्र गरिन्छ । नेपाली काँग्रेसभित्रै पनि आर्थिक नीतिको बारेमा एकमत नभएका कारण पनि यस्ता नकारात्मक चर्चा हुने गरेको छ ।

गिरिजाको आर्थिक उदारीकरणका अर्का सारथी पूर्वअर्थमन्त्री डा रामशरण महत कोइराला कहिले पनि यस्ता नकारात्मक प्रचारले नगल्ने, नथाक्ने र जोखिम लिन सक्ने नेता भएको बताउँछन् ।

राजनीति उदार व्यवस्था भएको अवस्थामा आर्थिक क्षेत्र पनि उदार बन्नु पर्ने भएकोले कोइराला नेतृत्वको सरकारले आर्थिक उदारीकरणको नीति लिएको पनि डा महतको भनाइ छ ।

डा महत हाल अस्वस्थ्य छन् । र नेपालको अर्थतन्त्रमा दोस्रो चरणको आर्थिक सुधार गर्न सक्ने हक्की प्रधानमन्त्री तथा अर्थमन्त्रीको अभावमा नेपालको अर्थतन्त्र पनि अस्वस्थ्य छ ।

त्यसैले पनि उद्यमीहरु गिरिजाप्रसाद कोइरालालाई सम्झिरहन्छन् ।

उनीसँग संगत गरेका पुराना उद्यमी ब्यवसायीहरुको भनाइ पत्याउने हो भने नेपालको इतिहासमा गिरिजाप्रसाद कोइराला मात्र एकजना यस्ता प्रधानमन्त्री हुन्, जो निजीक्षेत्रमैत्री थिए, उद्यमी ब्यवसायीका हितैषी मित्र थिए ।

कोइराला उद्यमीहरुलाई बेला बेलामा फोन गरेर उद्योग चलाउन के कस्ता समस्या छन् भनेर सोधिखोजी गरिरहन्थे । त्यसरी उनले सहजीकरण गरेका कारण नेपालको अर्थतन्त्रको विस्तार भएको हो, जुन कुराको आज पनि कमै मात्र चर्चा हुन्छ ।

कोइरालाको सरकारले बि.सं. २०४८ मा लिएको आर्थिक उदारिकरणको नीतिका कारण नै नेपालको अर्थतन्त्र विस्तार मात्र भएन २०५२ सालदेखि २०६२ सालसम्म निरन्तर एक दशक चलेको माओवादीको सशस्त्र द्वन्द्वमा पनि अर्थतन्त्र नकारात्मक भएन, डुब्नबाट जोगियो । माओवादीका विभिन्न अवरोध र हडताल एवं अपहरणकाबिच पनि उद्यमीहरु निराश हुनु परेन ।

आज तीन दशकपछि, कुनै किसिमका हडताल, अवरोध अनि उद्योगीको अपहरणजस्ता दुर्घटना भएका छैनन्, राजनीतिक स्वतन्त्रता प्राप्तीको लडाई पनि एउटा टुंगोमा पुगिसकेको छ । तर, उद्योगी ब्यवासायीमा चरम निराशा छ, अनि अर्थतन्त्रको गती सुस्त छ ।

त्यसैले उदारवादी अर्थतन्त्र र गिरिजा प्रसाद कोइरालालाई जति गालि गरे पनि नेपालको समाजिक आर्थिक विकासमा कोइरालाको भूमिका उनीजस्तै अग्लो छ, अतुलनीय छ र त सम्झन्छन् कोइरालालाई उद्यमीहरु ।

बिसं २०६३ पछिका वर्षहरुमा वामपन्थी रुझान भएका राजनीतिक दलहरु विशेषताः माओवादीले लगातार जस्तै सरकारको नेतृत्व गरे अथवा सरकारमा रहे । उनीहरु २०४८ सालपछि गिरिजाप्रसाद कोइरालाले लिएको आर्थिक उदारीकरणको नीतिको मौखिक बिरोध गर्छन् ।

तर, ब्यवहारिकरुपमा माओवादी आजसम्म पनि गिरिजाप्रसाद कोइरालाले लिएको आर्थिक उदारिकरणको नीति नै पछ्याउन बाध्य छन् । अझ दलाल पुँजीवादलाई गाली गर्दै दलाल समाजवादको यात्रामा विचौलिया उनीहरुका कोठा चोटा चाहारिरहेका कसैले देखेको छैन भन्ने भ्रममा बाँच्छन् ।

किनभने, विश्वमा नै बन्द अर्थतन्त्रको युग सकिएको ४ दशक भइसक्यो । नेपाल उत्तर कोरियाझैं एकांकी राष्ट्र होइन, त्यसैले सरकारको काम चुरोट, बिँडी बनाउने, जुत्ता चप्पल बनाउने होइन । नीति बनाउने र अनुगमन गर्ने हो ।

पूर्व सोभियतकालीन समयमा निजी क्षेत्रको भूमिका गौण हुँदा सरकार आफै उत्पादक हुन्थ्यो, अनि आफै बजारीकरण गर्ने गर्थ्यो। तर आज कम्युनिस्ट चीन पनि नियन्त्रित नै सहि निजीक्षेत्रको भूमिकामा विश्वास गर्दछ । संसारकै ठूलो अर्थतन्त्र बन्न चीन सरकारले पनि आफैं उद्योग चलाउँदैन, बरु निजी क्षेत्रलाई अगाडि बढ्न सहजीकरण गर्छ ।

किनकि उत्पादन तथा बजारीकरण गर्न सहज हुने नीति सरकारले बनाएपछि निजीक्षेत्रले आफैं उत्पादन गर्दछ, बजारीकरण गर्दछ, नाफा कमाउँछ, अनि सरकारलाई कर तिर्छ ।

कर तिर्ने उद्यम तथा उद्यमीलाई सहजीकरण गर्ने तथा सुरक्षा उपलब्ध गराउने काम मात्रै सरकारको हो । राज्यको नियन्त्रण र प्रत्यक्ष हस्तक्षेपबिना आर्थिक गतिविधिमा निजी क्षेत्रको सहभागिता वृद्धि गर्दै अगाडि बढ्ने आर्थिक नीति नै उदारीकरण हो ।

मुलुक समुन्नत हुन अर्थतन्त्र चलायमान हुनुपर्छ । अर्थतन्त्र चलायमान बनाउन उद्यमीलाई प्रोत्साहन गर्नुपर्दछ । उपलब्ध श्रोत र साधनको प्रयोग गरेर निजी क्षेत्रले सरकारले भन्दा बढि र राम्रो उत्पादन तथा बजारीकरण गर्न सक्छ भन्ने विश्वास उदारीकरणमा गरिन्छ । विश्वभर भएको पनि त्यहि हो ।

आर्थिक उदारीकरणकै कारण आज नेपालको अर्थतन्त्रमा निजी क्षेत्रको योगदान ८१.५५ प्रतिशत रहेको छ भने रोजगारी सिर्जनामा ८५.६ प्रतिशत रहेको नेपाल उद्योग वाणिज्य महासंघ तथा अन्तर्राष्ट्रिय वित्त निगम (आइएफसी)को एक अध्ययनले देखाएको छ ।

त्यसैले, विजयकुमार साह वा सिद्धार्थ राणाजस्ता उद्यमीले आफनो उद्यम गर्छन्, रोजगारी प्रदान गर्छन्, अनि कमाएको नाफामा गर्वका साथ सरकारलाई कर तिर्छन् । उद्यमीहरुले ब्यवसाय गरेर कमाएको नाफाबाट तिरेको करका कारण सरकारले आज १० खर्ब हाराहारी राजश्व उठाउन सक्ने क्षमता बनाएको छ । अन्यथा २०४७ सालमा ९ अर्ब २८ करोड रुपैयाँ राजस्व मात्र उठ्थ्यो । यो सबै संभव भएको उदारीकरणको नीतिले नै हो । जसअन्तर्गत राजस्व प्रशासनमा पनि सुधार गरिएको थियो ।

गिरिजा प्रसाद कोइरालाको राजनीतिक जीवनको सुरुवात नै २००३ सालमा विराटनगर जुटमिलमा भएको आन्दोलबाट भएर पनि होला निजी क्षेत्रसँग उनी सधैं नजिक रहे । किनकि उनले उद्योग र मजदुर दुबै देखेका थिए । उद्योग चलाउन सहज भए मजदुर पनि इज्जतदार जीवन बाँच्न सक्छ भन्ने उनलाई थाहा थियो ।

तर, पछिल्ला सरकारहरुले दोस्रो चरणको आर्थिक सुधार गर्नुको सट्टा पश्चगामी नीति लिएका कारण नेपालमा ब्यवसायमैत्री वातावरण नभएको तथा आफनो भूमिका खुम्च्याइएको निजी क्षेत्रको बुझाइ छ ।

पाँच-पाँच पटकसम्म प्रधानमन्त्री भएका गिरिजाप्रसाद कोइरालालाई विभिन्न कालखण्डमा विभिन्न आरोप पनि नलागेको होइन । उनलाई देवत्वकरण गर्न पनि आवश्यक छैन । तर, २०६६ चैत्र ७ गते शनिबार ८५ वर्षको उमेरमा मृत्यु हुँदासम्म पनि कोइराला न्याय र प्रजातान्त्रिक अधिकारको लागि अविचलित र अडिग नै रहे ।

कोइरालालाई ‘क्रान्तिदेखि शान्तिसम्म’का नायक, आर्थिक उदारीकरणका नायक वा प्रजातन्त्रको लडाईका नायक जे-जे भने पनि उनले राणा शासनविरुद्ध, पञ्चायतविरुद्ध तथा राजा ज्ञानेन्द्रको सरकारविरुद्ध तीन-तीन वटा प्रजातान्त्रिक आन्दोलनको नेतृत्व गरे ।

२०४६ सालदेखि २०६६ सालसम्मकोे दुई दशक नेपालको राजनीति आफ्नै वरिपरि घुमाउन सफल कोइराला नेपाललाई द्वन्द्वबाट बाहिर निकाल्न तथा शान्ती स्थापना गर्न १२ बुँदे सम्झौतामार्फत जोखिम लिन पनि तयार भए । जसका लागि आज पनि नेपाली समाजको एउटा तप्का उनलाई गाली नै गर्दछ ।

नेपालको राजनीतिमा गिरिजाप्रसाद कोइरालाले जति कालो झण्डा, गाली र विरोधको सामना जीवनकालभरि सायदै कुनै नेताले गरे होलान् । तर, पनि उनले सहमति, सहकार्य र एकता भन्न छोडेनन् ।

आफूले हारे पनि मुलुकले जित्नुपर्छ भन्ने दर्शनबाट प्रेरित कोइरालाले आफ्नो विरोध गर्ने र कालो झण्डा देखाउने प्रवृत्तिलाई आफैंले लडेर प्राप्त गरेको प्रजातन्त्रको उपलब्धिको रुपमा लिएको कुरा ‘आफ्नै कुरा’ पुस्तकमा उल्लेख छ ।

त्यसैले पनि आज उनको जन्म शताब्दीमा गिरिजाप्रसाद कोइराला सम्झन योग्य छन् ।

Government honours taxpayers, Vijaya Kumar Shah highest taxpayer

The government has honoured the largest taxpayers in 16 different categories, on the occasion of closing ceremony of Tax Week.

Finance Minister Dr Prakash Sharan Mahat today honoured the largest taxpayers from various sectors at the closing ceremony of the Tax Week organised on the occasion of the National Tax Day 2080, at the Inland Revenue Department (IRD). 

The liquor king Vijaya Kumar Shah -- founder and group chair of Jawalakhel Group of Industries (JGI) -- became the largest individual income taxpayer for second consecutive year, though it is the third time Shah has been honoured.

Nepal Telecommunications Company (Nepal Telecom) became the largest institutional income taxpayer for the fiscal year 2078-79 BS (2022-23), according to the IRD.

Though, the IRD has been celebrating the Tax Day on Mangsir 1 (November 17 this year) since last 12 years, the department has missed the day this year, and organised the felicitation programme on the last day of the Tax Week, today. The director general of IRD Dirgha Raj Mainali and revenue secretary Dr Ram Prasad Ghimire were absent at the programme, as both of them are out of country.

Likewise, Dabur Nepal, Asian Paints, OBC Foods and Feeds Company, Chhimek Microfinance Financial Institution and Global IME Bank are also honoured for being the largest taxpayers in different categories.

Life Insurance Company Nepal, Nobel Medical College, Manakamana Darshan and Bhatbhateni Super Market are also the largest taxpayers.

The government also honoured Nepal Stock Exchange (Nepse) and Bhotekoshi Hydropower Company among the medium taxpayers category, ranging from Rs 500 million to Rs 1 billion.

The government also honoured IME Ltd and Surya Nepal was also honoured for paying the highest income tax, value added tax (VAT), excise duty and paying VAT of five years on time. 

The government also decided to provide a special identity card -- for a period of one year -- for the largest taxpayers, according to finance secretary Dr Krishna Hari Puskar Karna. "The process of distributing identity cards to the largest taxpayers will start today," he said, responding to the vice chair of Surya Nepal -- which has been recognised with two felicitations -- Rabi KC, who asked the government to let them have special pass to enter the Singh Durbar, the seat of power. 

The largest taxpayers for fiscal year 2022-23

Highest Income Tax Payer (Institutional): Nepal Telecom

Highest Income Tax Payer (Individual): Vijaya Kumar Shah (Jawalakhel Group of Industries)

Highest Inland Taxpayer: Surya Nepal

Highest VAT Payer: Surya Nepal

Export Trade: Dabur Nepal

Special Industries: Asian Paints

Agriculture and Livestock Industries: OCB Foods and Feeds

Cooperatives/Microfinance: Chhimek Laghubitta Bittiya Sanstha

Banks/Finance institutions: Global IME Bank

Insurance: Life Insurance Corporation (Nepal)

Health/Educational Institutions: Nobel Medical College and Teaching Hospital

Tourism: Manakamana Darshan

Commodities Trade: Bhat-Bhateni Supermarket and Departmental Stores

Medium Scale Taxpayers: Nepal Stock Exchange (Nepse)

Energy: Bhotekoshi Power Company 

The largest individual taxpayers

2012 -- Prithvi Bahadur Pandey

2013 -- Siddhartha SJB Rana

2014 -- Siddhartha SJB Rana

2015 -- Dr Upendra Devkota

2016 -- Siddhartha SJB Rana

2017 -- Siddhartha SJB Rana

2018 -- Siddhartha SJB Rana

2019 -- Siddhartha SJB Rana

2020 -- Vijaya Kumar Shah

2021 -- Siddhartha SJB Rana

2022 -- Vijaya Kumar Shah

2023 -- Vijaya Kumar Shah

Embossed number plates mandatory from mid-March

The Department of Transport Management has issued directives to all authorities to ensure that the government-owned vehicles must have embossed registration number plates installed by mid-March 2022.

Any government-owned vehicle without embossed number plates will be fined Rs 2000, according to the Vehicle and Transport Management Act, 2049 BS, after the end of the deadline, the department confirmed today.

Director General of the department Dr Tokraj Pandey, confirmed that government-owned vehicles have been found to not paying tax since 10 years. “Thus, they are instructed to install embossed numbers,” he said, adding that the installation of embossed number plates will help collect taxes.

The department also informed that the tax must be cleared at the time of installation of embossed number plates. It is expected that the directive to install embossed registration number plates will increase the revenue of the government and the process of installing embossed plates will also be easier.

Shah becomes highest tax payer

Vijaya Kumar Shah, chairman of the Jawalakhel Group of Industries became the largest taxpaying Nepali in the last fiscal year. 

Shah, who leads Jawalakhel Group of Industries that incorporates companies like Jawalakhel Distillery, Himalayan Distillery, Raj Brewery, Asian Distillery and Vijay Distillery, received recognition as the largest tax paying person a fiscal year ago on the occasion of the 9th National Tax Day, also.

Finance Secretary Krishna Hari Pushkar honoured Shah along with Surya Nepal Pvt Ltd – as the largest institutional taxpayer today at a programme organised by the Inland Revenue Department (IRD) to mark the 11th National Tax Day 2022.

During the last fiscal year 2021-22, Surya Nepal paid Rs 10.72 billion in taxes, up from Rs 9.34 billion a fiscal year ago. The company sells cigarettes, matchboxes, incense sticks and confectionery.

The government honours largest taxpaying individuals and organisations under 15 categories of taxes on the occasion of the National Tax Day every year.

The government also honoured Nepal Telecom under the largest income taxpayer category, whereas the producer of refined oil and vegetable ghee Shiva Shakti Ghee and Rajesh Metal Crafts were honoured under export-based and special industry categories. The OBC Feeds and Food was honoured under the agriculture and livestock industry category. 

Likewise, Chhimek Laghubitta Bittiya Sanstha received honour under cooperative category, Nabil Bank under banking sector and IME Remittance under remittance category are also honoured for their largest tax contribution in their respective sectors in the last fiscal year.

The Inland Revenue Department (IRD) Nepal has honoured Nabil Bank chief executive officer (CEO) Gyanendra Prasad Dhungana for the bank’s contribution. Nabil Bank had paid Rs 2.79 billion in taxes in the last fiscal year. This is the seventh consecutive year – in the past 10 years – that Nabil Bank has been honoured for its contribution to the national exchequer. “The Bank has paid Rs 18.38 billion in taxes to the state in the last 10 years. “The bank has also distributed Rs 14.45 billion in cash dividends and bonus shares worth Rs 18.8 billion to its investors,” according to the bank.

According to a press note issued by the Inland Revenue Department, the programme to commemorate the 11th National Tax Day also witnessed Nepal Re-insurance Company being honoured as the top taxpayer in the insurance category. Biratnagar-based Nobel Medical College and Teaching Hospital was felicitated as the top taxpayer in the health and education categories. 

Manakamana Darshan, the operator of the cable car in Kurintar and Chilime Hydropower were honoured as the highest taxpayers in tourism businesses and energy-oriented industries, respectively. Similarly, Nepal Stock Exchange topped the list among medium-scale taxpayers.

IME Ltd, the first money transfer company in Nepal, was honoured as the highest taxpayer in the remittance and money transfer category, whereas Hansraj Hulaschand and Co was honoured for its contribution to the commodity trade sector.

According to the department, Gorkha Brewery, the producer of Tuborg, Carlsberg and Gorkha beers, Somersby Apple Cider and Red Bull energy drink, was announced as the largest contributor in the value-added tax (VAT) category. Likewise, Mangalam Industries Pvt Ltd – a manufacturer of water supply, plumbing, sanitation, and drainage piping solutions and also the first CPVC Pipes and Fittings manufacturer and leading polymer piping systems manufacturer and exporter from Nepal – was the highest taxpayer company in the manufacturing industry.  during fiscal year 2021-22. According to the press note of the IRD, the award was handed over to chairman Dr Sudarshan Churiwal and director Mrs Shashi Churiwal of the company.

In the last fiscal year, Rs 429.27 billion in revenue has been collected, against the target of Rs 450.34 billion, according to the department press note. “The total number of taxpayers in the country, including the businesses and individuals holding a permanent account number (PAN) reached 4.81 million as of 2020-21, among which, some 3.05 million are individual PAN card holders, by the end of the last fiscal year.”

SC seeks Rs 5 million bail from former IRD chief Sharma

 The Special Court today asked for Rs 5 million bail from former director general of the Inland Revenue Department (IRD) Chudamani Sharma, who has been accused of revenue leakage worth over Rs 1 billion.

After a hearing, a division bench of judges Abdul Aziz Musalman and Justice Nityananda Pandey issued the verdict.

The Commission for the Investigation of Abuse of Authority (CIAA) had filed a case against three persons including Sharma at the Special Court on June 23 accusing them of corruption. The CIAA had sought to recover a total of Rs 1.33 billion from the accused.

Sharma, who has been accused of one of the largest corruption scandals in Nepal's history, was under investigation for possessing property amassed through alleged corruption. The two other accused including Tax Settlement Commission (TSC) chairman LD Mahat and the TSC member Umesh Prasad Dhakal, who also cleared an amount of Rs 5 million each to be released on bail on Sunday.

They have been accused of the abuse of authority by making the taxpayers submit less than the actual amount, causing a huge amount of revenue leakage to the state.

Kathmandu Metropolis shaming tax defauletr with music and dance

The Kathmandu Metropolitan City has launched an innovative campaign to recover tax dues from businesses and entities in the capital.

The metropolis officials today went around the capital city with all-women musician troupe playing traditional music like panche baja door-todoor , with a group of city police personnel blowing bullhorn to remind the defaulters to pay their taxes. They were wearing sashes with messages to pay tax on time.

They visited the offices of five tax defaulters — Kantipur Hotel at ward 1, Hotel Platinum at Soalteemode, WhiteField School, RB Complex, and Kesha Properties and Ranjana Trade Centre at New Road, today. The band reached the houses of people, who had not paid the tax and sang a song urging them to abide by the citizens' role to compulsory pay property tax on time. They also pasted tax notices at the offices warning them to pay the dues within a week or face legal action.

The metropolis is, however, criticised for only pressuring the small tax payers, and not pressing the big tax payers to pay tax.

The city office claimed that it will take action according to the Local Government Operation Act 2017 and other prevailing laws, if the defaulters did not clear the taxes by September 9.

The city office -- in July-end -- had announced to padlock the offices of 23 tax defaulters. Earlier, in June too, the City office had named some 23 businesses and entities as tax defaulters, including Chirayu Hospital, Kantipur Dental Hospital, Tribhuvan University Teaching Hospital, Shaheed Memorial Hospital, National Hospital, Manmohan Hospital, New Road Team, United Trade Centre, Buddhabai Complex, Bagmati Chamber, Kathmandu Engineering College, Nepal Tuberculosis Centre, Nepal Red Cross Society, Aadhar Complex, Agriculture Inputs Company Ltd, RB Complex, Suraj Arcade, Manmohan Memorial College, Shubhashree Cooperatives, Kathmandu Plaza, Nepal Share Market Complex, Gopalji Properties and Star Mall.

Later, on August 8, the City’s revenue department had named some 52 more tax defaulters giving them a month, until September first week, to clear the dues.

Of the total 75 tax-defaulters, some 10 have paid some of the tax dues. The City office collected a total of Rs 24.9 million from them, according to the revenue department of the City office. "Though, 75 businesses and entities owe around Rs 65 million in taxes."

The metropolis is encouraging locals to pay their property tax pending for the last three to 28 years. The Kathmandu metropolis charges 0.01 per cent of the government's evaluation of property, which is one of the lowest among other local governments inside the valley.

After huge pressure, government extends tax clearance date till June 21

The government has backtracked from its earlier decision – within 24 hour – on payment of individual and business taxes and deferred the deadline to pay taxes and submit tax details by 15 days to June 21 after a huge pressure from the private sector and the main opposition Nepali Congress (NC).
According to the new notice by the Inland Revenue Department (IRD) published today, the deadline is extended keeping in mind the nationwide lockdown and risk of coronavirus transmission. The government has imposed the lockdown till June 14 – by extending it for the eighth time since March 24 – to contain the spread of coronavirus. And the department yesterday published a notice ordering businesses and individuals to clear their tax dues by June 7 as in the normal times. The department – in the notice – asked businesses and individuals to submit the second instalment of income tax of the current fiscal year by mid-June and value added tax (VAT) and excise duty till mid-March and mid- April, respectively, by June 7. “The failure to meet the deadline for filing tax returns and clearing tax dues of previous months will result in charges,” the notice read.
But the notice only infuriated private sector, citizens and main opposition party. The main opposition party Nepal Congress – issuing a press note signed by party president Sher Bahadur Deuba – has urged the people to gently disobey the government diktat to clear tax by June 7, as the country is still under lockdown since last 72 days bleeding the economy. Nepali Congress alleged that the government has been terrorising private businesses, labourers, and farmers with tax compliance instead of introducing a special relief package to them.
The businesses have remained shut for almost two-and-a-half months since March 24, and the movement has been curtailed by the government, which is forcing the people to pay tax by June 7 within lockdown period, said an angry entrepreneur. The lockdown has been imposed till June 14.
After the criticism from different sectors of the society, the department in its new notice today said that the deadline to submit tax details, income details and payment of taxes has been extended to June 21. The department has extended the deadline to pay value added tax, excise duty, tax deducted at source (TDS) under income tax, education service tax, telephone ownership fee, and telecommunication service fee to June 21 from the previous deadline of June 7, according to a notice issued today by the department.
According to the revised decision, businesses and individuals are now required to submit the second installment of income tax of the current fiscal year by June 29, the new notice reads, adding that VAT and excise duty need to be submitted by June 21.
This is the third time that the government has extended the deadline to pay taxes as the country continues to remain in lockdown to prevent the spread of Covid-19, which has claimed nine lives and infected over 2,300 people across the country till date.
The infuriated private sector representatives – including Federation of Nepalese Chambers of Commerce Industry (FNCCI), Confederation of Nepalese Industries (CNI), and Nepal Chambers of Commerce (NCC) – has criticised the government decision for exerting undue pressure on the private sector to clear taxes despite the continuation of lockdown.
The deadline extension followed a request from the private sector representatives to the finance secretary Shishir Kumar Dhungana during a meeting with Finance Ministry officials today morning. “The government decision to extend the deadline is a move towards a positive direction,” senior vice-president of the FNCCI Shekhar Golchha said, adding that the private sector has asked that the deadline be extended till the end of current fiscal year, until mid-July. “Most of the businesses are not in a position to pay taxes immediately as there is still a lack of cash flow due to the fact that the markets are closed.”
The VAT and excise duty are taxes that the business people have collected in the market but they have already been spent. “So, they need to raise cash from the market to pay the tax authority,” he added.
The government, on the other hand, is under pressure to mobilise revenue as the government coffer is almost empty, and from the beginning of the new fiscal year 2020-21, the government may not be able to pay salary to government staff due to huge deficit in revenue mobilisation because of its failure in collecting taxes.
According to the Finance Ministry, the government has only collected Rs 657 billion so far, against a target of Rs 967 billion by mid-June. “Though Dr Yuba Raj Khatiwada is the second lucky finance minister to present three budgets in a row – after 1990 – he has failed, for the second consecutive years, to mobilise the revenue and also spend budget,” sources at the Finance Ministry claimed that the stronger government – in the history of Nepal – led by KP Oli has failed to create business friendly environment and promoted ‘some businessmen’ for the benefit of the party. “The stable, stronger and powerful communist government is promoting crony-socialism rather than taking care of people, which has resulted in the revenue deficit since last two fiscal years after Khatiwada took charge of the Finance Ministry.”

Ncell gets two-week ultimatum to pay CGT dues

The Large Taxpayers Office today gave an ultimatum to Ncell to clear its outstanding capital gains tax (CGT) dues within 15 days.
The LTO’s ultimatum to Ncell to clear the dues came on the same day that the tax office received an official letter from an international investment dispute settlement court asking it not to initiate CGT collection process from Ncell.
Issuing an interim order last week, the International Centre for Settlement of Investment Disputes (ICISD) had directed Nepal not to ‘take any steps’ to enforce its decision to collect Rs 22.4 billion in outstanding CGT – including interest and penalties – from the sale of Ncell by TeliaSonera Norway to Axiata UK. The LTO officially received ICSID’s order today, confirmed the LTO officials. Though LTO claimed thagt it will discuss about the ICSID’s letter with the government, it has – contrary to ICSID’s directive – directed Ncell to clear the outstanding CGT dues within two weeks.
Based on the verdict of the Supreme Court, the LTO had asked Ncell to deposit Rs 22.44 billion remaining CGT dues within 15 days on December 8. However, Ncell did not clear its dues within the given time forcing the LTO today to give ultimatum to deposit Rs 22.6 billion tax dues – including interest and late fees – to telecom service provider.
The government will take necessary action on the basis of the Income Tax Act, if Ncell fails to clear dues within the time, the letter reads, adding that the LTO will take action based on provisions mentioned from Section 104 to 109 of the Income Tax Act.
However, experts said that the interim order issued by ICSID is obligatory for countries that are its members based on previous tribunals.

Stakeholders seek integrated policy to regulate businesses

Complaining that the duplication of number of provisions in the laws has still been discouraging the investors, experts stressed on the need to merge concerned government institutions to effectively implement the government policy to facilitate investment via one stop service center. Likewise, they also stressed on the need for the government to formulate integrated laws governing the business sector to attract investment in the country.
Outlining that contradictions in multiple business-related laws and policies that have been discouraging potential growth of business sector, they asked the government to bring a unified policy. “Even today, Nepal has some unnecessary laws and policies that are affecting investment,” former finance secretary Ramehwor Khanal said, while addressing an interaction 'A Discourse on Integration of Economic Legislations' organised jointly by Samriddhi Foundation and Society of Economic Journalists Nepal here today. “It is high time for the government to scrap such obsolete and unnecessary policies and introduce an integrated policy to regulate the business sector,” he said, adding that multiple business- and investment-related policies formulated by different ministries are contradictory and ambiguous, thereby discouraging businesses. “For instance, tax waiver and subsidy on any good and service can be given only through the Financial Act.”
However, other policies have also been giving tax subsidy under different headings,” Khanal added. “The registration and exit process for companies are yet to be simplified as procedural hurdles are the primary factors that investors look at before injecting investment in any country.”
He also opined that there should not be any minimum threshold and capital requirement for foreign investors to invest in Nepal. The government has increased the minimum threshold for foreign investors to Rs 50 million, which has discouraged most of the foreigners to invest in Nepal. Khanal also blamed the government authorities for duplication of laws. “Nepal achieved significant improvement in the Doing Business Index this year just because of the reforms in number of laws,” he said, adding that procedural hassles are, however, still there.
The private sector participants, on the occasion, also complained that contradictory policies have been deteriorating business and investment environment in the country. They criticised the government for failing to address new types of business, including start ups, in the new laws. “The government needs to come out of the conventional mindset of implementing policies only for trading of goods and services,” director of Laxmi Group Niranjan Shrestha said, adding that it also has to consider mobility based business like venture capital in its regulatory framework.
Acknowledging the importance of bringing integrated policy to regulate businesses and investment, president of Nepal Law Commission Madhav Poudel said that the concept has to be brought to light and discussed widely among stakeholders.
“The government is facing difficulty in addressing various practical hurdles in existing policies and laws,” he said, adding that it is, however, aware of all policy hurdles and contradictions in the existing laws that are discouraging businesses. “While the government is working to gradually address such issues, various agencies are facing structural problems and difficulties in coordination.”
Paudel also accepted that there is duplication of laws as there are many laws to regulate the private sector. “The disintegrated laws have been creating problems to possible investors,” he said, giving an example of the lengthy procedures that the entrepreneurs need to fulfil for tax compliance.
The participants, on the occasion, deliberated on the possibility of integrating Foreign Investment and Technology Transfer Act with other acts related to foreign exchange and banking, insurance and securities. The laws related to forest, environment and land acquisition can also be implemented through a single legal provision as the integration of laws can also help remove inconsistency and ambiguity in several government rules. “In many cases, government officials are found to be demarcating area in their jurisdiction and delaying service delivery even after merger of two or more government offices,” the participants complained, urging the government to revisit the Foreign Investment and Technology Transfer Act (FITTA).
Ahead of the Investment Summit in March, the government had hastly revised number of laws including FITTA and Public Private Partnership and Investment Act. The laws were, though expected to simplify the procedures related to the Department of Immigration, Inland Revenue Department, Department of Land Management, Department of Customs and central bank to facilitate foreign investors, the foreign investors are still complaining that the laws are more regressive than before.
“Despite implementation of these new laws, investors still do not have access to online system and it is difficult to validate their digital signature,” Paudel said, adding that the investors still need to visit various government agencies to submit hard copies of their signed documents.
However, joint secretary at Finance Ministry Uday Raj Sapkota, on the other hand, defended the government and claimed that it is serious about addressing the issues of policy ambiguity and contradictions. “The private sector should, nevertheless, clearly communicate about the problems they are facing due to existing policies and come up with feasible recommendations,” he said.
The government is in the process of implementing a single-code system for the income tax, value added tax, and excise duty, as an effort to simplify the procedures for taxpayers, Sapkota informed, adding that the tax administration had stepped up preparations for enforcing single-code for the three tax systems. “The ministry is about to make amendment to Financial Act for enforcing the new system.”
According to him, the government has adopted the policy of reducing the number of government institutions and integrating the related laws to reduce hassles for potential investors. “The government has established one-stop service center and enacted several laws to attract foreign investment,” he added.
On the occasion, researcher at the Samriddhi Foundation Kul Prasad Pandey gave a brief introduction about the context of the discussion citing international examples, areas in which Nepal is lacking and reasons thereof with regards to its ranking in the Doing Business report, the idea of consolidation of act, harmonisation of legislations and minimising duplication of government entities and subsequent regulations.

Revenue mobilisation target falls short

The government failed to meet the revenue mobilisation target due to shortfall in value added tax (VAT) and income tax in the first four months of the current fiscal year.
The Inland Revenue Department (IRD) – In the period between mid-July and mid-November – has mobilised Rs 104 billion revenue, which is only 83.2 per cent of the target. “Of the annual revenue mobilisation target of Rs 506 billion – for the current fiscal year 2019-20 – the target for the first four months was set at Rs 125 billion.
The department informed that it is also unable to meet the revenue mobilisation target for excise duty, health service tax and education service fee. “However, the collected amount was an increase of 23 per cent against the department’s revenue mobilisation in the same period of last fiscal year,” the department informed, claiming that the department is continuously identifying the lapses and initiating reforms for revenue mobilisation.
The IRD had formed the study team in July to identify the lapses in tax mechanism, and recommend it.
The department is also gearing up to provide the facility of 10 per cent cashback on electronic payments to promote the digital payment system and also the formal channel for trading.
The department is also gradually implementing its five-year (2018-19 to 2022-23) tax reform strategic plan to make the revenue administration more stronger ans transparent.

Only 10 per cent of Nepalis pay tax

Though the government claims to have reformed tax administration and expanded tax net, only 10 per cent Nepalis pay tax.
According to the Inland Revenue Department (IRD) director general Binod Kunwar, only 2.96 million Nepalis are under the tax net, including income tax and value added tax (VAT). The population of Nepal has around 3 million population, according to the Central Bureau of Statics (CBS).
“In the last fiscal year, some 2 million Nepalis were under the tax net,” he said, adding that some 800,000 tax payers have been added in the current fiscal year. “The ‘Pan for All’ programme has encouraged more Nepalis to come under tax net,” he claimed, adding that the government has also made PAN mandatory for all working Nepalis to get their salary paid. “Likewise, there are some 2339,000 taxpayers under the value added tax (VAT) net.”

Some 900 firms under DRI scanner for ‘tax evasion’

According to Department of Revenue Investigation, more than 900 firms are under investigation for purchasing and using fake value-added tax (VAT) bills. “These firms were delivering goods and services to government agencies, contractors, multinational companies, hydropower companies and hospitals, depriving the government of its revenue,” according to director-general of the department Dirgharaj Mainali.
More than 100 companies that sold fake bills are currently under the scanner, he said, adding that it had earlier filed cases against 39 individuals for printing and selling fake VAT bills. In March, the department had registered a case for the first time against 24 individuals. An additional 15 individuals were dragged to the court in June.
“The combined value of the fake VAT bills under investigation is around Rs 11 billion,” Mainali said, adding that the alleged VAT scam may be the biggest one yet in terms of both value and the number of firms involved. “The department today also filed a case at the Kathmandu District Court against proprietor of Lucky AS Enterprises Sunil Kumar Gautam for evading taxes worth Rs 99.56 million through alleged submission of fake VAT bills.
According to the body responsible for investigating revenue theft, it is the third case filed by the department in the last 10 days against people submitting fake VAT bills. “The alleged tax evasion in the three cases is cumulatively worth Rs 342.85 million,” a press note issued by the department reads.
The department – on November 12 – registered a case at the Kathmandu District Court against proprietors of Huspy Care International and Shree Shyam Traders for dodging taxes worth Rs 111.98 million. Likewise, the department – on November 5 – had filed a case at the same court against the proprietors of Nepal Donghua Construction Engineering Company, charging them of evading both VAT and income tax worth Rs 131.31 million.
After targeting the sellers of fake bills, the department is focusing now on investigating and filing cases against the firms that purchased and used them to evade tax, Mainali said, adding, “By showing higher expenditure on fake purchases, they also paid less income tax.”
Earlier, in the fiscal year 2010-11, the Inland Revenue Department (IRD) had built up cases to recover Rs 6.69 billion in back taxes from 518 firms. Many of these cases remain undecided but the Supreme Court is going to be decided very soon.

Tariffs on half a dozen goods revised again after first quarter

The government has revised customs and excise duty on more than half a dozen goods – including gold, silver, cosmetic products, cleaning materials made of iron and steel, and coffee related products, hatching eggs, acrylic emulsion – after the end of first quarter of the current fiscal year 2019-20 to promote the domestic products and discourage the imports.
Though, the government argued that customs and excise duty was revised as per the need mentioned in Sub-section (1) of Section 18, Financial Act, 2019, private sector has expressed dissatisfaction over the revision of customs and excise duty within three months of the implementation of Financial Act 2019. “It will affect stability of trade,” reads a press note issued by Nepal Chamber of Commerce (NCC) today. The chamber reminded government that industries and trading firms do businesses on the basis of their commercial plan prepared according to the Financial Act made public at the beginning of the fiscal year. “But the change in three months will create policy instability making it difficult for the businesses to operate,” it reads.
The cabinet meeting – on November 4 – has decided to revise the customs tariff on gold, silver, wine and coffee related products. The government has increased customs duty on gold imported for commercial purpose by Rs 1,500 per 10 grams on top. Likewise, the government – through the budget speech for the fiscal year 2019-20 – had increased customs duty on gold to Rs 5,000 per 10 grams. With the fresh revision, customs duty on the precious yellow metal has reached Rs 6,500 per 10 grams.
Likewise, tariff on silver has also been increased to Rs 75 per 10 grams, up from Rs 56 per 10 grams.
“The migrant workers bringing in up to 50 grams of gold are now required to pay Rs 7,500 per 10 grams, which was Rs 6,200 per 10 grams before the revision,” according to the notice published in the National Gazette. “If such workers bring 50 grams or more gold, they will have to pay Rs 8,500 per 10 grams as customs duty.” Such tariff was Rs 7,200 per 10 grams before.
The Gazette reads that customs duty of Rs 8,500 per 10 grams will be levied on gold ornaments of up to 50 grams. Earlier, customs tariff on such imports was Rs 7,200 per 10 grams. Likewise, customs duty on import of gold ornaments above 50 grams has been set at Rs 10,000 per 10 grams from Rs 9,000 per 10 grams, the Gazette reads.
Likewise, the government has also increased excise duty on cosmetic products to 10 per cent from 5 per cent. It has also decided to impose excise duty of 5 per cent and 10 per cent on cleaning materials made of iron and steel, and coffee related products, according to National Gazette.
The government has, however, relaxed customs tariff on goods like hatching eggs, acrylic emulsion and excise duty on wine produced in Nepal to promote the domestic products. The government has reduced customs duty on hatching eggs by half. Similarly, customs duty on import of acrylic emulsion – raw material for paints – has been reduced to 20 per cent from 30 per cent to promote the domestic production. The government has also lowered excise duty on wines – wines having up 12 per cent alcohol – made using locally produced fruits by 30 per cent.

Nepal third competitive economy in South Asia

Nepal climbs one position to become the third competitive economy – out of the eight economies in South Asia behind first-placed India and Bhutan – from the fourth last year, whereas the country has jumped to 94th position – with 63.2 score – out of 190 economies in the World Bank’s ease of doing business rankings due to improved credit information availability, easier cross-border trade, and enforcement of contracts.
Nepal was in the 110th position – with a score of 59.7 points – in the doing business ranking in 2019 World Bank report. The leap of 16 places is also attributed to Nepal’s dissatisfaction over the last year’s ranking. Nepal was ranked 105th in 2018 and slipped five positions to 110 in 2019.
In the Doing Business Report 2020, Nepal scored highest on access to credit information – 37th out of 190 economies – among the 10 indicators used by the World Bank to calculate the ranking as the country has improved access by expanding the coverage of the credit bureau.
Likewise, Nepal also ranked relatively high on cross-border trade – 60th out of 190 economies – as the country has reduced export costs and improved import times by opening the Birgunj Integrated Check Post (ICP), according to the annual report.
However, Nepal has spiralled down in starting a business indicator from 107th to 135th, which reflects all the procedural delays and time-consuming processes that have always deterred investors in Nepal. “Nepal is still poorly ranked in starting a business ranking as the country is in 135th position among the 190 economies as the country has made things more difficult – according to the World Bank – by
Nepal made notable improvements with four reforms, the report reads, adding that the country improved an online e-submission platform for construction permits and enhanced the quality of land administration by publishing official service standards for delivering updated cadastral maps. “Authorities improved the commercial judicial system by introducing time standards for key court events.”
However, Nepal made the process of registering new employees with social security more cumbersome by requiring in-person follow-ups. The country also raised property transfer registration fees, it adds.
Overall, of the 10 indicators that the World Bank evaluates to rank countries, Nepal has improved in five indicators, slipped in three and remained constant in two indicators compared to the previous year, according to the report.
The report measures procedural changes but not the quality and efficiency of the implementation of structural reforms in tax regimens and in starting a business, apart from changes in regulation. Hoever, the report does not account for the level of corruption and the existing level of investor confidence, which are major factors affecting the investment climate.
The index draws data from a questionnaire administered to professionals who oversee or advise on legal and regulatory requirements for doing business. According to the World Bank, most respondents are legal professionals such as lawyers, judges or notaries. In addition, officials of the credit bureau or registry complete the credit information questionnaire. Accountants, architects, engineers, freight forwarders and other professionals answer the questionnaires related to paying taxes, dealing with construction permits, trading across borders and getting electricity. This profile of respondents to the questionnaire perhaps accounts for the report’s focus on regulatory measures over their implementation.
Many South Asian economies kept up a solid pace of business regulatory reforms as India and Pakistan both earned spots among the world’s top ten most improved economies, the World Bank Doing Business 2020 study revealed, adding that it is encouraging to see the steady implementation of reforms in South Asia. According to senior manager of the World Bank’s Global Indicators Group, which produces the study, Rita Ramalho, “Continued and sustained progress is key to improving the domestic business climate and enabling private enterprise.”
Economies in the South Asia region carried out 17 reforms to improve the business climate for domestic small and medium-size enterprises.

South Asian ranking
Afghanistan  – 173
Bangladesh – 168
Bhutan  – 89
India  – 63
Maldives  – 147
Nepal  – 94
Pakistan  – 108
Sri Lanka  – 99
Source: World Bank

Tax evaders to face up to five years of jail

If any government official and private sector individual is found to be colluding to evade taxes, then they are liable to face jail terms, according to a new law endorsed by the Federal Parliament today.
According to the Revenue Leakage (Investigation and Control) Act – endorsed by the Federal Parliament – if civil servants and businesspeople are found to be collaborating to evade taxes, then the civil servant will be suspended till the case is settled and could also face a minimum jail term of six months to a maximum of five years, depending on the volume of the revenue leakage. “If any government official is booked by the Department of Revenue Investigation (DRI) for investigation of revenue leakage, the official will be automatically suspended until the issue is resolved,” it reads, adding that the defrauder will also have to pay a fine of 100 per cent to 200 per cent of the misappropriated amount. “If the revenue leakage is below Rs 5 million, the guilty will be imprisoned for six months, whereas for revenue leakage of above Rs 5 million to Rs 10 million, the jail term has been fixed at six months to one year.”
Likewise, the offender will face a jail term of one to three years for revenue leakage from Rs 10 million to Rs 30 million. “If the guilty is found to be involved in revenue leakage of over Rs 30 million, then they will be imprisoned for three years to five years.”
But the act has given the respite for revenue leakage due to genuine mistake. “If the revenue leakage occurred due to a genuine mistake, and the amount is up to Rs 5 million, the guilty could receive half the jail term and will have to pay only half the fine,” the new act reads, adding that the guilty will have to face a jail term and pay the maximum fine, for amounts beyond Rs 5 million.
However, the earlier act has that any offender involved in revenue leakage had to face a jail term of only up to three years and pay a fine that was 200 per cent of the misappropriated amount.
According to chairman of Finance Committee under the Federal Parliament Krishna Prasad Dahal, the law has been amended as the previous laws to control revenue leakages were not effective enough.

Government says rumours being spread about tax system

A senior minister has claimed that the rumours have been spread about the tax system against the government.
Speaking at the inauguration of Responsible Business Summit – organised by the National Business Initiative (NBI) – here today acting Prime Minister and Minister for Defence Ishwor Pokharel said that some persons are irrationally accusing the government about the taxation system without knowing the facts. “Definitely, the government has introduced and expanded some provisions in the taxation system, but there are more rumours than facts, he said.
Stating that the government is always supportive of the private sector for overall development of the country, he added, “, we need to join hands to achieve the SDGs by 2030.”
The two-day Responsible Business Summit – organised to promote business leadership for attainment of Sustainable Development Goals (SDGs) in the country – is scheduled to cover 16 different sessions, in which various corporate groups, SMEs, banks, government agencies, development partners and other stakeholders will discuss about the scope, nature, benefits and challenges of business responsibility in Nepal.
On the occasion, president of NBI Padma Jyoti said that the summit will discuss and show a possible way out of the current unfavourable business environment in the country. He also informed that the summit will encourage focusing on achieving different SDGs that the country has adopted.
“We believe that the summit will motivate and facilitate businesses to integrate SDGs into mainstream business practices in Nepal,” he said, adding that it will also support in implementation of corporate social responsibility laws in Nepal. “The time has come for the government and private sector to join hands to furnish the agendas of SDGs and clean development.”
According to Jyoti, the summit will cover issues related to fast-paced and sustainable prosperity to address needs of stakeholders, including employees, consumers and local communities. Discussions will also be held on ensuring sustainability of natural and man-made environment and to explore partnerships necessary to achieve SDGs in Nepal, he added.
Speaking at the programme, resident coordinator of the United Nations (UN) in Nepal Valerie Julliand said that every development should take place without damaging the environment. “SDGs are development goals that meet the needs of the present without compromising the ability of future generations to meet their own needs, so any development needs proper resource planning and proper management of resources and to create awareness among the concerned people,” Julliand said, adding further that resources should be used judiciously so that after fulfilling our present requirements they are also preserved for the future generation. “With the increasing population and their ever growing demands, the rate at which the resources are being used has risen dramatically.”

Government mulls introducing inheritance tax

The government is considering introducing inheritance or estate tax to widen parameter of revenues on wealth.
Speaking at an interaction on ‘Contemporary prospects and challenges of Nepali economy’ organised by Nepal Chamber of Commerce (NCC) in the capital today, finance minister Dr Yuba Raj Khatiwada said that the Finance Ministry is exploring various options for inheritance tax although it has not yet reached a decision.
The ministry is currently discussing on the modality of inheritance tax, he said, adding that the issue will be tabled at the to-be-formed Revenue Board, though the ministry is planning an extensive discussions before introducing such tax.
Though, inheritance tax is common in the developed countries, it could flare a negative debate in Nepal as according to culture, the children naturally inherit their parents property after death. The inheritance tax is levied on property inherited from person who has died. The inheritance tax rates are determined on the basis of various factors including the condition of the residence, property, total worth of the inheritance, and the beneficiary's relationship to the deceased. Several countries across the world including Britain and Japan have such tax. The tax is either imposed as duty on the estate of a deceased or as an inheritance tax on the inheritor.
Though, Dr Khatiwada didn't go into the details, inheritance tax could be one of the perfect tools to check corruption and red tape in the country. But the proposal for inheritance tax as it has been proposed at a time when the three tiers of government are being criticised for creating 'tax terror' to meet their resource needs, has sent negative message to the business and industry fraternity.
On one hand the government officials and political leaders are being blamed for misuse of government funds and tax paid by the citizen in luxury vehicles, foreign junkets and paying perks to people's representatives, on the other additional tax, in the name of inheritance, is not going to please the citizens.
After the country is federated into three tiers of government, they are under tremendous pressure to manage funds for their operations. The local and provincial governments have lately been imposing taxes arbitrarily to meet their funds needs.
Dr Khatiwada, on the occasion, also said that the government will not excuse traders and businesses that are found to be evading taxes. “The private sector undoubtedly is the major force to drive the economy and the intention of the government is to facilitate businesses, not to trouble them but businesses should abide by the legal framework,” he said, urging the traders to come and have discussions with the government regarding their concerns or any change in policies that is hampering business growth.
The minister also reminded the traders that the government is tightening imports to give a boost to domestic production and encourage exports.
Regarding the government’s recent move of implementation of permanent account number (PAN) and vehicle and consignment tracking system (VCTS), Dr Khatiwada said that their implementation will prove to be a boon for the economy in the long run.
But the NCC president Dr Rajesh Kazi Shrestha, on the occasion, said that the government should hold enough consultations with the private sector before introducing such business-related policies.

Finance Minister blames auto importers of tax evasion

Finance Minister Dr Yubaraj Khatiwada blamed the auto importers of tax evasion.
Inaugurating the 14th edition of NADA Auto Show 2019 here today, he accused them of tax evasion while importing hybrid vehicles. Urging to run business honestly, he reminded that the government has a policy of tax exemption only for the electric vehicles. “The hybrid vehicles that run 90 per cent from fuel and only 10 per cent from electric energy are not exempted from taxation,” he said, reiterating that the government has given tax incentives for the import of hybrid vehicles to promote hybrid vehicles but automobile dealers, in turn, are importing battery-operated vehicles which run on diesel or petrol.
He also said that the government is ready to protect and promote those entrepreneurs wishing to set up electric vehicle plants. “Instead of depending on sales of imported vehicles, the government encourages automobile entrepreneurs to build assembly plants in the country itself and is always open to discuss this topic,” he added.
“As the nation’s economy continues to grow, people’s paying capacity is also increasing which leads to increase in demand of automobiles,” he said, adding that the government is liable to develop road infrastructure and safety, but until and unless the Melamchi Water Supply Project is completed, the government will not be able to construct black-topped roads.
Speaking on the occasion, NADA Automobiles Association chair Shambhu Prasad Dahal, demanded government to focus on road infrastructure development. Dahal, also asked the government to exempt excise duty on vehicle accessories. “Nepal’s automobile industry has been contributing a lot of revenue to the economy and it’s now time for the government to encourage automobile industrialisation in the country.”
The 14th edition of NADA Auto Show that will last until September 2 is organised by NADA Automobiles Association of Nepal and managed by Global Exposition and Management Services. The most anticipated automobile extravaganza is also seeing participation from 23 four-wheelers, 19 two-wheelers, 12 lubricant, nine tyre, five battery, 14 garage equipment and auto components brands and 13 financial institutions.
The venue also has a Traffic Information Desk set up by the Metropolitan Traffic Police Division where visitors can learn about road rules and safety.

Nepal Satellite Telecom gets a week extension to clear dues

Nepal Telecommunications Authority (NTA) has given Nepal Satellite Telecom (NST) an extension of a week to clear part of its pending dues, though the government has repeatedly directed to clear its dues.
According to chairman of the NTA Purushottam Khanal, , the company needs to pay Rs 70 million within August 18, while it can pay the rest of its outstanding amount within three months from August 18.
The company – owned by businessman Ajeya Raj Sumargi – needs to pay nearly Rs 1 billion as licence renewal fee, frequency fee, service expansion fee and fee for Rural Telecommunications Development Fund.
Earlier too the authority had allowed Smart Telecom extended time – in 2017 – to pay its dues.
However, this is the last chance for the the telecom company to keep its licence, he said, adding that the regulator is doing its level best not to have to scrap the operating licence of any telecom firm. “If the telecom company fails to abide by the regulator’s instruction this time, the NTA will revoke its licence.”
Nepal Satellite Telecom had filed a writ petition – seeking cancellation of the amount that it had to pay to NTA – at the Supreme Court but the Apex Court refused to give continuity to a stay order on a writ petition. A single bench of Chief Justice Cholendra Shumsher Rana on July 18 had refused to continue the stay order in favour of Nepal Satellite Telecom.
According to the telecom regulator, different telecommunication service providers have not paid dues worth Rs 2.96 billion to the government. There are some 153 telecommunication service providers in the country. United Telecom Ltd (UTL), Smart Telecom, Nepal Satellite Telecom, BroadLink Network are some of the telecommunication service providers that have not cleared their dues.
Smart Telecom – the largest one to pay dues – has to pay Rs 1.4 billion. Likewise, UTL has to pay Rs 795 million tax to the government as under frequency fee, royalty fee and renewal fee.