Kathmandu, January 8:

State minister for finance Dr Roop Jyoti, who is busy in the preparation of Finance Ordinance, tried to calm down the business community in the capital today saying that the government would not reduce customs tariff at the cost of local industry. He was addressing the meeting called by Revenue Consultative Committee (RCC) formed under the ministry of finance.

Jyoti also clarified that there would not be any policy changes in the forthcoming Finance Ordinance as it is only the continuation of last ordinance brought six months ago. Some adjustments in customs tariff would be made to make them compatible in the context of World Trade Organisation (WTO), which will not sabotage our industrialisation process.

“Value Added Tax (VAT) should be the main source of national revenue and the government would go ahead effectively to implement VAT by creating healthy environment across the country,” he said, adding that the main objective of the forthcoming ordinance would be to discourage the practice of ‘under-invoicing and smuggling. Jyoti said that the VAT threshold would not be removed but would be further strengthened.

Prof Madan K Dahal, head at the Central Department of Economics, Tribhuvan University, who is also a member of RCC, suggested the government to remove anomalies in the revenue front through the ordinance. “In a developing economy like ours,” Prof Dahal said, “We need to be competitive in terms of customs rates and quality products.”

“We have faced challenges in terms of revenue collection and to expedite development activities,” he said. Dahal stressed on removal of legal and infrastructural problems suggesting to make RCC a permanent body to expedite revenue related issues.

Binod K Chaudhary, president of Confederation of Nepalese Industries (CNI) requested the government not to increase import tariff at the cost of local industry and economy. “The industrial sector is facing various problems that has pushed our productivity and investment at the lowest ebb,” said Chaudhary, “What is important, right now, is that new opportunities be explored and environment for doing businesses be enhanced to go in a competitive way in a changed context.”

Surendra Bir Malakar, officiating president of Nepal Chamber of Commerce (NCC) also asked the government to protect domestic industry by not increasing import tariff. He also urged the business sector to be competitive in the context of implementation of WTO and SAFTA provisions. “Revive sick units to boost industrialisation,” he requested the government.

Diwakar Golchha, first vice-president of FNCCI urged to make a roadmap for Nepali industries’ growth.