Kathmandu, May 29
Aiming to promote the local industries, the government has announced an increase in tax on imported goods.
The private sector had been demanding since long for an increase in the tax on imports so that it could encourage local products in the market.
Addressing the demand, Minister for Finance Yubaraj Khatiwada has increased the tax on imported goods while announcing the budget for next fiscal year.
The budget has increased customs tax on chicken by three times from 10 per cent to 30 per cent. Similarly, customs tax on milk or milk products has been increased to 40 per cent, while 15 per cent customs tax has been levied on dry coconuts, cashews and peas.
As the private sector along with the government was working together to make the country self-sufficient on tea and coffee production, the government has levied 40 per cent customs tax on the import of tea and coffee.
“In order to protect and promote local products, the government has increased custom tax on tea and coffee,”
Khatiwada said today while delivering his budget speech.
He further requested the entrepreneurs of various startups to pay their taxes by mid- April, 2020. If they do so, then the tax, fine, extra charge and interest of their previous taxes will be exempted.
Meanwhile, addressing the demand of sugar mills, the budget has levied 40 per cent customs tax on the import of sugar or sugar products.
Likewise, 40 per cent customs tax has been levied on chocolates, cocoa powder, pasta, macaroni, noodles, crispy breads, ginger bread, biscuits, fruit juice and potato chips.
Similarly, the customs tax and excise duty on tobacco and liquor have also been raised. Along with this, the aforementioned imported products will be costlier for consumers.
While the customs tax on zinc has been set at 20 per cent, excise duty on mobile phones has been set at 2.5 per cent.
Likewise, the government has announced to provide 50 per cent exemption on transportation vehicles imported by agriculture cooperatives.
The government will levy only one per cent customs charge on machinery and its spare parts required for garment industry.
Along with this, the budget has reduced customs tax on yarn, medicines, sanitary pads and feed supplements.
In order to encourage digital payment, the ministry has brought a system of refunding 10 per cent of VAT on the use of ATM cards to pay for any good or service. This new system has elated the private sector.
Along with this announcement, the private sector has expressed its belief on the development of the industrial sector in the country.