‘Tax Reforms Could Boost State Revenue by Rs 300 Billion’

The High-Level Recommendation Committee on Tax System Reforms, formed by the government, has stated that the country could get Rs 300 billion more if the tax systems were revised.

The Committee has suggested that the provision to write off value-added tax given on some goods should be scrapped, the existing cap on income tax should be amended, excise duty should be waived except on goods that cause harm to human health, a green tax should be imposed, social security tax should be revised, and the amount of digital payments should be increased while discouraging cash payments.

The government formed the four-member committee under the chairmanship of Bidhyadhar Mallik about nine months ago. The Mallik Committee submitted its report three months ago.

The Committee has proposed the establishment of an Implementation Facilitation and Monitoring Unit under the command of the Revenue Secretary for the effective implementation of the recommendations on tax system reforms.

If the reform measures stated in the Committee’s report were implemented, the country could get Rs 291 billion more in revenue, according to the report made public by the Ministry of Finance. Laxman Aryal, Prof. Dr. Ram Prasad Gyawali, and Shyam Prasad Dahal were the members of the Committee.

Chairman of the Committee Mallik said that the projected increase in revenue was based on extensive study and sectoral calculations. “This is a tough job but not impossible,” Mallik argued.

The upcoming fiscal year’s budget has also included the idea of implementing the Committee’s recommendations. Chairman Mallik shared that he was hopeful about the implementation of the report’s recommendations. “The results will be positive if the recommendations are implemented in three to five years,” he reasoned.

Likewise, Aryal, who is also a former secretary with extensive expertise in the tax system and revenue administration, said the projection of getting Rs 300 billion more is for the present-day context, adding that it will be higher than the given estimation in the future. “The report has clearly stated how and from where it is possible,” according to Aryal.