Budget presents objective assessment of economic challenges: Finance Minister

KATHMANDU: Finance Minister Prakash Sharan Mahat has said the budget for the upcoming fiscal year 2023/24 has presented a minute and objective analysis of existing challenges in the economy. Responding to queries at the meeting of the House of Representatives on Monday over questions raised during the deliberations on the recently presented budget, Minister Mahat said the budget was centred on accelerating economic activities and thus addressing the existing economic issues and challenges gradually. As he claimed, factors discouraging capital expenditure have been identified and an emphasis has been placed on downsizing public expenditure in the budget. "Announcement for economic reforms, policy improvements to promote private investment and priorities to digital and green economy are some of the key points of the budget." According to him, through the budget, the government has laid emphasis on innovation, production and employment creation. Big infrastructure projects are given continuity, the criteria of revenue collection have been extended and tax rates have been revised, prioritising system reforms in tax administration. On the occasion, Minister Mahat stressed conducting an environmental impact assessment before operating river-based queries and importing river-based products. He also said the government made its attempt to make customs duty on electric vehicles practical. Electric vehicles have been classified into five groups and revised tax rates have been imposed accordingly. As per the revised tax system, 10% customs duty will be charged on EVs up to the capacity of 50 kilowatts, 15% customs duty and 10% excise duty on vehicles from 50 to 100 kilowatts, 20% custom duty and 20% excise duty for vehicles from 100 to 200 kilowatts. Likewise, 40% customs duty and 45% excise duty will be charged in the import of vehicles from 200 to 300 kilowatts.  The customs duty for vehicles above this capacity remains unchanged. The Minister said tax rates for petroleum vehicles of all capacities are the same and only slight changes have been made in the rates of excise duty. During the replies, he said the accusation on the government that it leaked information about revises in tax rates in the budget, leading to imports of vehicles on a large scale on the eve of the budget speech kept no meaning. The trend shows that large imports take place before the budget speech each year. A letter of credit for 90% of recently imported 1,300 vehicles was proceeded in March-April, according to him. He claimed that the tax on EVs in Nepal is the least in the entire SAARC, suggesting the government's priority to promote EVs. As he mentioned, it is from 35% to 100% in India, 50% in Pakistan and around 90% including all taxes in Bangladesh. READ ALSO:

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