KATHMANDU, JUNE 19
All seven provinces unveiled their budgets for the next fiscal year 2022-23 beginning mid-July last Wednesday, laying focus on reviving an ailing economy by increasing agricultural production and expanding the social safety net.
Except for the Koshi provincial government, which brought its annual budget through an ordinance, the remaining six provinces have already presented the Finance Bill along with the Appropriation Bill in their respective Province Assembly.
Koshi Province has made some changes in its revenue policy through an ordinance itself. Looking at the resource management of the provincial governments, resource collected from own sources is less while they are more dependent on fiscal transfers and revenue distribution from the federal government.
Therefore, it is seen that the provinces have emphasised on expanding both the tax rate and its coverage in order to increase the proportion of the internal revenue.
The provinces have the rights over determining the vehicle tax, houses and land registration, tourism fees, advertisement tax, tax on agricultural income, service charges and fines and other surcharges. The provinces have been making their revenue policy every year incorporating these sectors.
In their revenue policies, provinces have given main priority to making the internal sources more effective by expanding tax ambit in economic activities falling under their exclusive and concurrent eights, to rendering tax system convenient and technology-friendly, to making tax rate up-to-date by revising the tax structure and rate and to stress on controlling tax evasion and revenue.
Similarly, the provincial governments have included in their Finance Bill provisions such as exemption on registration and transfer of vehicles, discouraging the use of motor vehicles older than 20 years, making the land and house registration and transfer easier, providing some exemption on the registration and transfer of land used for production and exemption on the fine to commercial companies failing to renew for a long time.
A version of this article appears in the print on June 20, 2023, of The Himalayan Times.
