Kathmandu, March 20:

To generate government revenue and stop revenue leakage, industrial activities should be made simple and hassle-free, recommended Prof Pushkar Bajracharaya in his study ‘Excise Tax in Nepal.’

Presenting his paper, at a programme organised by ‘FNCCI Anti-Corruption Project’ in the capital today, Bajracharya said that the lack of clarity in taxation system, complex procedure and high handedness of tax administrators are the major problems facing the process of revenue collection.

The problems engendered by the complex, non-transparent and ambiguous taxation system have also led to corrupt practices, he said. “High excise rate is one major reason that has attributed to malpractices,” Bajracharya added.

Excise is an important source for the government and despite various government initiatives, the problems persist, he said adding that to deal with the problem of excise evasion, the government should have clear laws and policies.

Dr Bajracharya also suggested that the government could deal with the problem by managing the output rather than dealing with the issue at various level. “The excise unit within the Inland Revenue Department (IRD) must be strengthened with necessary technical expertise, laboratory access and overall capability to monitor, control and improve collection. Monitoring and regulating capacities also need to be substantially upgraded,” he said.

Participants at the programme suggested that the government carry out a full-fledged research before implementing any excise laws and policies so that it would not turn out to be a disaster for industries.

Rajendra Prasad Shrestha, associate professor at TU, said that inefficiency of administration can be a key tool to take on tax evasion.

Murari Karki, director at IRD, suggested that the government introduce a ‘one window approach’ to deal with problems so that it becomes easier to monitor, control and implement regulations.