KATHMANDU, July 13: The government has registered a bill in Parliament to repeal four different finance-related acts and one regulation.
The 'Bill for Amending and Repealing Some Finance-Related Nepal Laws, 2083,' which was registered in the House of Representatives on July 7, is aimed at repealing some laws and updating others. The goal is to deal with legal complications, avoid duplication, bring legal reforms that match the Constitution and federal system, make revenue administration more technology-friendly, and improve public services.
The Ministry of Finance has stated that this bill has been registered in Parliament because it is necessary to remove legal and institutional provisions that are not in line with the spirit and intent of the Constitution and seem irrelevant in the context of the current federal governance structure, to end legal duplication, and to ensure effective public service delivery in less time and at lower cost.
The bill proposes to annul the Regional Development Plans (Implementation) Act, 2013 BS; the Act to Increase the Circulation of Nepali Currency, 2014 BS; the Income Ticket Fee Act, 2019 BS; the Revenue Leakage (Investigation and Control) Act, 2052 BS; the Act Related to Financial Intermediary Institutions, 2055 BS; and the Revenue Leakage (Investigation and Control) Regulations, 2070 BS.
Similarly, the bill includes provisions to amend the Value Added Tax Act, 2025 BS, the Income Tax Act, 2058 BS, and the Customs Act, 2082 BS.
The bill proposes a provision in the Value Added Tax Act, 2052 BS, adding a new system where vehicles transporting goods for commercial purposes have to be registered in an online web-based transport monitoring system.
9 financial bills ready for parliamentary deliberation
According to the proposed system, when transporting goods for commercial purposes using legally registered transport vehicles, the details have to be entered into the web-based online vehicle monitoring system before transporting the goods.
The bill also requires that all registered or soon-to-be registered transport vehicles in Nepal must have a GPS device installed that shows the current location according to the set standards, and its serial number has to be registered with the relevant authority.
However, the bill also proposes that transportation vehicles operating in certain areas can be exempted from GPS installation.
The bill states that tax authorities can fine up to Rs 50,000 for the first time and up to Rs 100,000 for each subsequent violation on vehicle owners or users who do not enter details in the online system, fail to carry necessary documents, or violate GPS installation rules.
Significant amendments proposed to Income Tax Act
The bill has proposed significant amendments to the Income Tax Act, 2058 BS. A new definition of 'non-taxable' has been added to Section 2 of the Act.
According to the proposed system, 'non-tax' means fees, charges, service charges, royalties, dividends, fines, or refund amounts payable under current law. Interest applied to such amounts is also defined as non-tax.
The bill proposes to add a new section 72 (a) to the Income Tax Act, dealing with non-tax determination and collection. According to this provision, if non-tax dues that should be paid under existing law are not paid or submitted, authorities can investigate and determine these non-taxes under the direction of the Government of Nepal.
It has been proposed that if additional non-tax liabilities are found through the investigation, a 100% penalty will be imposed.
Once the bill presented by the government is passed by the parliament and implemented, it is expected that the use of information technology in revenue administration will expand, transportation systems can be monitored in real-time, non-tax collections will become more organized, and outdated and irrelevant legal provisions will be removed to create a legal structure suitable for the federal system.
