KATHMANDU: The Revenue Advisory Committee has submitted a comprehensive report to Finance Minister Bishnu Prasad Paudel, outlining key recommendations to enhance Nepal’s revenue system and broaden the tax base.
Revenue Secretary Dinesh Kumar Ghimire handed over the report to Minister Paudel at a program held at the Ministry of Finance today.
The committee has recommended that all economic activities be brought within the tax net, suggesting the expansion of the tax base and digital adaptation of revenue collection mechanisms.
It also stressed widening the scope of electronic service tax to reflect increasing digital transactions and suggested proper management of data from international service providers.
Other key suggestions include classifying real estate transactions as commercial activities to ensure they are taxable, making capital gains tax records transparent and technology-friendly, and linking taxpayer data with financial statements for better compliance.
In terms of customs reforms, the committee advised reviewing customs rates, simplifying procedures, and adopting globally recognized valuation standards to promote trade facilitation while protecting domestic industries. It also called for a digital overhaul of customs systems to enhance transparency and efficiency.
To diversify income sources, the report highlights the need to identify non-tax revenues, revise current rates, and strengthen institutional frameworks. It suggests realistic rate settings, digitized and transparent collection systems, and clearer delineation of revenue responsibilities across federal, provincial, and local governments.
The report further recommends establishing mechanisms for forecasting, implementation, and evaluation of non-tax revenue sources, and ensuring their accurate reflection in the national budget.
Finance Minister Paudel acknowledged the significance of the recommendations, stating that they will play a crucial role in shaping the budget for the upcoming fiscal year.
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