Kathmandu, December 3

With an aim to control revenue leakage, the government has asked beer producers to paste excise duty stickers on beer bottles. As per the provision of the excise regulations the government is trying to impose a new legal system for beer producers, which has been imposed on other liquor products since long.

Earlier, beer producers were allowed to paste excise stickers on the cartons only, however from January 1 the government is implementing the new system. “When the excise stickers were used only on beer cartons we realised there was a lot of revenue leakage. So, the government has planned to use stickers on each bottle,” said Shishir Kumar Dhungana, revenue secretary of the Ministry of Finance (MoF).

Based on the decision of the Inland Revenue Department, beer producers are now preparing the groundwork to put stickers on the bottles. “The stickers are ready and I have heard that beer producers are importing machinery used for pasting stickers on the bottles,” Dhungana informed.

The MoF believes that once the new provision is implemented it will help control revenue leakage. “The government was not able to control revenue leakage when the excise stickers were pasted only on beer cartons, so we are going to implement it on each bottle,” stated Dhungana.

Meanwhile, beer producers have expressed a different view regarding the government’s decision to implement the new system. “It is a bit impractical to implement a new system in the middle of a fiscal year and the government should have launched this system at the beginning of a new fiscal,” one of the beer producers said, seeking anonymity.

However, revenue experts have said that the government has to implement this new system of pasting excise duty stickers on each bottle of beer if it wants to control revenue leakage. “Implementing this new provision will be a challenge to the government and beer producers could create strong pressure on the government to postpone the implementation date,” a source at the Finance Ministry said, seeking anonymity.

The source also informed that the government had tried to implement this system in 2000, however beer producers lobbied against the government decision and it could not be implemented then.

Earlier, the government had implemented the use of excise duty stickers on each bottle of liquor except beer after the Excise and Liquor Act 2000 came into force.

Meanwhile, the government had amended the Financial Act and had mentioned during the launch of the fiscal budget that the MoF had planned to introduce the system of pasting excise stickers on each bottle of beer within the current fiscal year.