Kathmandu. Nepal Chamber of Commerce (NCC) President Kamlesh Kumar Agrawal said although the budget for the fiscal year 2083/84 was ambitious, it would boost the morale of the private sector. He said this while speaking at a post-budget discussion organized by the Nepal Economic Journalists’ Association.
“It will revive the economy that has been stalling for a long time,” he said. It seems to be presented as a starting point to enter a new era of economic prosperity by giving a new dimension to the country’s economy. He expressed the hope that the budget for the coming fiscal year would usher in a new era of economic prosperity as Nepal has been entangled in the quagmire of policy and intention for long.
“Nepal is a country with abundant potential. Our destiny is to have the highest percentage of GDP and be the country with the highest GDP growth in South Asia. But for a long time, we have been entangled in the quagmire of policies and regulations. Policy is the budget, and rules are good governance. This budget has been presented as a starting point to usher in a new era of economic prosperity by giving a new dimension to Nepal. For this, I would like to extend my heartfelt congratulations to the Finance Minister. ‘
He recalled that the history of Nepal’s budget is with that of the Chamber of Commerce. “Nepal Chamber of Commerce was established a year before the budget was announced. In this period of 75 years, we are celebrating the diamond jubilee in a grand manner this year.
“I have taken the budget as a starting point as it was presented in a short implementation period of two months of the formation of the government,” he said. He said, “If we continue at this pace for the next 5 years, then there will be no difficulty in reaching our destiny that I said earlier.” According to him, most of the suggestions put forth by Nepal Chamber of Commerce have been addressed. “Tax reform has been stalled for a long time,” he said. The budget has taken a big leap forward in tax reform this time. There has been a big relief in personal income tax. For many years, we have been confused by giving this tax exemption in the range of 5 lakhs and 6 lakhs to those earning up to 10 lakhs annually. It did not start a transparent economy. This time, our demand was to start with Rs 10 lakh, which is something the honourable minister has reflected in the budget. ‘
He welcomed the provision of reducing excise duty on 360 types of goods. According to him, excise duty had created a big problem in Nepal. “Our harmonized code is 8 digits,” he said. There is a 10-digit harmonized code in the world. The difference between 10 and 8 has been used in an arbitrary manner, and many of the businessmen who have suffered have been victimized.
He also praised the government for reducing customs duty on 273 industrial raw materials. “This is also a good beginning for Nepal’s industrialization,” he said. We have been demanding for a long time, the goal of introducing VAT. The private sector has been encouraged by the government’s clause that it can levy multiple rates by publishing a notice in the gazette.
According to him, the system of multi-rate VAT has been started by imposing 5 percent VAT on electricity and ride-sharing. However, he differed on the issue of 5 percent VAT on electricity. “There is a little bit of it that Nepal has abundant potential, abundant potential of water resources,” he said. This seems to be a bit of a disagreement when you look at how we should continue to make it cheaper in our own production. This will be considered by the Minister in the coming days. According to him, a high-level committee has been formed to study the relevance of multiple types of VAT and submit corrections. ‘
He said that after a long time after this Covid pandemic, due to retrospective taxes and other taxation pressures, due to many informal taxes, many entrepreneurs have been caught in litigation. He said that for this, he has made a provision to waive all the fines and penalties by formulating a good scheme, giving only 1 percent of this amount. For this, on the one hand, the resources of the government will also increase. On the other hand, large entrepreneurs will also be at ease.
He said that the issue of capital gains tax levied in the capital market has been clarified. “Just yesterday, the finance minister made it clear in a press conference that this capital gain is the final tax. But what is more, there are still many clauses that have a double effect on our laws, which have been made in the past.
For example, if someone with an income of more than Rs 40 lakh, who has income from the corporate sector, will show it in the account, for this, if the laws are amended in the coming days, according to the need, it will not create any kind of confusion. He also praised the IT sector for being declared as a strategic industry.
