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The Tax Reach in Nepal
The Balen government has a Finance Minister who at least knows a thing or two about finance compared to the previous ones who were actually fomer Maoist commanders who had to face rats eating CCTV footage or getting shady visitors inside the Ministry to change the tax rate or customs duty for some byaparis or jagga dalals and chamchas of those living in Baluwatar.
We really need to work on increasing the tax revenue and not depend mostly on indirect taxes like our VAT and customs duty and stuff. If most of us were to stop buying motorcycles, cars and even smart phones and any luxury goods or even foreign chocolates and roses and consumer goods then our government will not have any dough to even pay our government employees on time let alone set aside some for debt servicing or even any development projects.
Every year, we are mostly short by a few billion dollars when it comes to our government's total revenue and expenditures. According to my sources, majority of the so-called big business houses who brag about paying tons of taxes every year are the ones who have been scamming the system by evading taxes and submitting fake VAT bills for decades.
I don't see any reason why any byaparis who have been paying their taxes without under-reporting their income or faking their VAT bills should be worried about the new government's fiscal policies in the days to come. If you have been grabbing public land and evading taxes and bribing hakims and netas left and right before then please be very afraid because the Balen government is like Liam Neeson minus the violence. Our government will find you and make you pay the price for your shady activities.
It seems that the government should really make sure that they somehow bring those involved outside the tax net back into the game. Only a few of us really pay income taxes and when it comes to transparency on these taxes, yes our big business houses and banks have done a good job but of course, it's not like you are paying extra. The employees pay the taxes from their salaries, while when it comes to VAT and other stuff then most of our trading companies seem to be faking it.
We need to make sure that all gharbetis pay the actual rental income tax and the government must not turn a blind eye to all the funny figures they give to our municipalities. Who is going to believe that you are only charging Rs 70,000 for a whole building in New Road or Durbar Marg? And how many landlords in the country are paying rental income taxes when renting out single rooms?
We also need to be strict on our land deals. Most of us do not want to pay the required taxes when we sell our land for profit or loss. If the deal was for Rs 5 Karod, we would go to the Malpot, offer Chiya Kharcha to our hakims there and make it a real estate deal worth not even half of the actual amount.
The government should make tax evasion the numero uno in the most heinous crime list, even above murder and other serious crimes. If you evade taxes, then pay 1,000% more in fines or spend 1,000 days in jail doing hard labor under Harka Sampang's grand labor plans. I really want the Balen government to make Harka Sampang our Labor Commissioner, create a new position if there is none but give this man something to do physically!
The majority of us work in the informal sector and hence, we really don't pay taxes on our income or projects. It's time all small businesses were registered with the local wards. Well, that has been the rule since Manjushree decided to do his act in Chovar, but so far, most of the folks running small businesses don't care, and the local wards either do not have the manpower or are just too lazy to take action against anyone operating a business, even if it is for profit or not.
We need to tax our artists, be it our movie stars, film makers, music video wallahs or even those involved in creating artworks like painting, sculpture, poetry, rap and many more. I think most of those engaged in the arts world rarely pay taxes or even report their income to the government.
Our art galleries must pay taxes on their 30 to 40% commission when they sell art works to their buyers. Durgesh Thapa should pay income taxes on his 3 Karod income from his tours and Mahatsav appearances and foreign trips as well. Nothing against Durgesh but just trying to make my point here.
Every chiya pasal and bhattis in our country should be registered and should have a formal hisab-kitab. And for the bhattis, it is time our government legalized our local raksis but only after they pass certain health guidelines. Our bhattis sell local raksis like crazy all over Nepal and those making it are not paying any taxes and those selling it are not either but do face police action once in a while during election or festivals. The rakis end up at our police station for some reason and only a few are sprinkled on the ground for some media photo-op once in a while.
The government can come up with a legal government app for small business owners where they enter their daily sales and expense reports and the taxes are calculated automatically at the end of the day. It might take a while but not all small businesses buy from Bhatbhateni or other stores withe PAN. So it is difficult for us to expect them to present VAT and PAN bills for audit and stuff.
I think everything should be transparent and everybody should pay their taxes. And those under the so-called poverty level should get rebates like in the West. Big businesses employing thousands of employees should get some incentives as well but as long as they pay fair wages not Rs 15,000 for our nurses or Rs 12,000 for our baristas or Rs 8,000 for our sales girls and then claim to employ hundreds or thousands of folks and get away with tax evasion and other illegal stuff.
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