Government’s Decision to Waive Tax on Import of Books gets Mixed Reaction

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Government’s Decision to Waive Tax on Import of Books gets Mixed Reaction

November 11: The local entrepreneurs of Nepal have opposed the government’s decision to waive 10 percent tax on import of books from abroad. They say that the government’s decision to remove the tax imposed on books but to give continuity to tax on import of paper would land the country’s industries in trouble.

Former Finance Minister Yuba Raj Khatiwada had stood in favour of the tax on import of books despite criticism from various quarters. However, the Council of Ministers on Monday decided to lift the additional 10 percent customs duty imposed on imported books. Prior to this, the government had been charging only 5 percent tax on such books.

The government enjoys the privilege to change the tax rate as per the Financial Act 2077. The Council of Minister used the  same act to remove the tax upon the recommendation of Finance Minister Bishnu Poudel, informed Dr Prakash Shrestha, financial advisor to the finance minister.

Dr Shrestha argued that the decision will not impact the local industries of Nepal.

The import of books had declined after the then Finance Minister Yuba Raj Khatiwada imposed 10 percent excise duty on imported books about a year ago. Khatiwada took such decision after it was found that the Nepali publishers used to publish books abroad and then import the books to Nepal by evading taxes.

Newly-appointed Finance Minister Poudel revoked the decision taken by the former minister in a around month since his appointment.

Although the government has waived the tax on imported books, it continues to collect tax from books printed within the country.

The books published inside the country have to incur 15 percent taxes on import of paper and an additional 13 percent value added tax. In addition to that, the government also charges tax for printing due to which the local entrepreneurs have to pay a total of 31 percent tax to the government.

Manohar Das Mool, one of the importers of paper, says it is unfair to waive the tax on import of books while charging excessive taxes on books published within the country.

However, book stores and stationery shops have welcomed the decision of the government to remove the tax on imported books.

 

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