KATHMANDU, AUGUST 31

Revenue Department of Kathmandu Metropolitan City has written to all 32 ward offices, directing them to identify all the tax defaulters and recover the amount from them.

As per the letter sent by KMC last week, the ward offices will have to identify taxpayers, who have tax due for the past two years, and correspond with the defaulter for recovery of the amount. The taxes include applicable rent tax, business tax, advertisement tax and entertainment tax under the local level laws.

The ward offices have also been told to send the details of tax defaulters to the Revenue Department, which had earlier conducted market monitoring to bring all house owners and entrepreneurs under the tax net. The market monitoring followed the tendency of house owners and entrepreneurs to either evade or undervalue tax under the existing local level laws. House owners and entrepreneurs are obliged to pay rent tax and business tax respectively.

During the monitoring, dozens of house owners and businesspersons of New Road, Lazimpat and Maharajgunj areas have been directed to present themselves before the department within seven days.

KMC warned that some house owners had claimed to be renting out shutters of the same house for different amounts with the intention of showing less tax payable to the metropolis.

Likewise, the owner of an adjoining house had been receiving rent of Rs 40,000 in Maharajgunj. KMC has taken such a huge difference in rent seriously and will conduct an inquiry before initiating action as per the law.

The department warned that there were less number of house owners paying rent, compared to those paying business tax. The monitoring team of KMC comprises ward representatives, municipal police, department and ward officials. Recently, KMC had introduced tax e-payment system. The online system is convenient for taxpayers, as they no longer have to queue up at the office for payment.

In February, KMC had recovered Rs 70 million in tax arrears from big taxpayers, who had not paid land, house and property tax for the past 28 years after it published the names of 52 big tax defaulters.

A version of this article appears in the print on September 1, 2022 of The Himalayan Times.