Govt ready to support the private sector in R&D

Lalitpur, Aug 4

Minister for Finance Dr. Yuba Raj Khatiwada said on Sunday that the government was ready to support the private sector in research and development.


"Private sector must investment in human resource development, capacity building, and must pay reasonable salary to the workers. Research and development is the shared responsibility of the government and business enterprise," he said at the inaugural programme of the two-day Management Meeting organised by the Inland Revenue Department (IRD).


According to him, the government wanted just and transparent competition among the business enterprises and to formalise the informal economy.


The situation where the government and the private sector afraid of each other should be ended, Dr. Khatiwada said.


He said that the government was not revenue-oriented and urged the private sector not to work just to fulfil their own self-interest but to benefit the society as well.


"The government will make safe, fair and transparent business environment to increase the confidence of the private sector. Latest information technology will be applied to install faceless revenue system," he said.


Finance Minister Dr. Khatiwada said that the government would communicate with the public in terms of Value Added Tax (VAT) rates and revenue collection.


"Business institutions are just a mean to pass the liability from the public to the government. Therefore, there will be dialogue between the government and the public, the ultimate tax-payer," he said.


He said that people should pay taxes even though they did not want to do so.

Dr. Khatiwada also said that the government would not deter from implementing the Permanent Account Number (PAN).


"PAN is just like a citizenship card. Everyone should have it as they have the citizenship. Having PAN does not mean that an individual has to pay the taxes by force, but it should be paid when there is an income," he said.


He said that that managerial, administrative and regulatory improvements would be continued for the second phase reform in tax administration.


Lal Shankar Ghimire, Secretary of Revenue at the Ministry of Finance, said that the government would increase the presence of tax office at the locations convenient for the taxpayers across the country, and would also promote online services.


He criticised the private sector for being informal and out of tax net.


"Economic Census 2018 had shown that 50 per cent of the economy is informal. I would like to urge the private sector to help the government in bringing the remaining 50 per cent economy in the formal business," Ghimire said.


He also said that the income tax does not respond to the 82 per cent of GDP that goes to consumption.


Rajesh Kazi Shrestha, President of Nepal Chamber of Commerce (NCC), said that there was a need to expand the tax base.


"Government is trying to reduce import and promote domestic industrialisation. However, lowering import might hit revenue collection which may force the government to increase tax on other topics. Therefore, there is a need to expand the tax base," he said.


He urged the IRD to implement the transaction price-based customs evaluation and said that it would reduce many complexities in tax administration as well.


Shrestha said that there was a need to organise training to the business community to educate them on various tax provisions and compliance measures.


Satish Kumar More, President of Confederation of Nepalese Industries (CNI), said that the taxpayers should be respected.


Bishnu Prasad Nepal, Director General of the IRD, said that the department had to meet the target of Rs. 506 billion revenue collection in the current fiscal year, 41 per cent up from the previous fiscal which demanded special strategy and planning.


There are 2.2 million taxpayers in the country, of them 348,162 were added in the last fiscal.

Published in The Rising Nepal daily on 5 August 2019.