Budget for FY 2021/22: High priority given to rapid economic recovery
The government has given high priority to the rapid economic resurgence along with relief and concessions to tax-payers in the adverse situation resulting from human health and economic crisis while determining the revenue policy and tax rate for the next fiscal year.
Presenting the statement of income and expenditure for the coming fiscal year 2021/22, Finance Minister Bishnu Poudel announced tax exemption and concession to industries affected by the COVID-19 pandemic, promotion of domestic and external investment, and protection of domestic industries, trade facilitation, expansion of tax limit and mobilization of additional revenue by means of controlling revenue leakage.
He made it clear that the revenue system would be rendered more progressive, uncorrupted, transparent, automated, and predictable. Similarly, he said the objectives of revenue mobilization are to increase the capability of the revenue administration, the promotion of voluntary tax participation with the maximum utilization of information technology and infrastructure development.
The Finance Minister said arrangements have been made for income tax concession of 90 percent to tax-payers with transaction up to Rs 2 million, of 75 percent to the tax-payers with annual transactions from Rs 2 million to 5 million, and of 50 percent to the tax-payers with annual transactions of Rs 5 million to 10 million, calculated on the income of the Fiscal Year 2020/21.
Similarly, the arrangement has been made for charging only one percent income tax on the taxable income of hotels, travel, trekking, transport and aviation service, film industry, and media houses highly affected by the COVID-19. The period of transferring the period of loss of business has been extended to 10 years.
Reduction of customs tariff, VAT, and excise duty charged on the import, production, and sale and distribution of life-saving medicines and medical goods as oxygen gas, liquid oxygen, oxygen cylinder, oxygen concentrator, among others has been put in place till January 2022.
The Finance Minister also shared on the occasion that the excise duty on the import of electric vehicles has been fully scrapped and the customs duty has also been significantly reduced to promote the use of environment-friendly vehicles and to increase the domestic consumption of electricity.
