PTI
Kathmandu
Nepal government on Tuesday withdrew the three per cent equity tax imposed on private education and health sectors following widespread public criticism. In a social media post, Prime Minister Balendra Shah said the decision was taken after the proposed levy triggered concerns over additional financial burden on the public.
After consultations with Finance Minister Swarnim Wagle, the government has decided not to implement the equity tax on private education and health sectors “for now”, he said.
The three per cent levy was introduced last month in the budget for the new fiscal year and came into effect from July 17.
Shah said the tax was introduced to expand the tax base and make the economy more organised. However, the government took note of the public response and decided to suspend its implementation.
The move comes after the tax proposal drew widespread criticism from citizens, the media, and political parties.
“This government is people-centred, based on the trust and expectations of the people. Our main goal is to establish good governance and ensure that all citizens experience a quality life,” Shah said.
He said the government remained committed to listening to the citizens’ concerns while pursuing its goal of building an equitable society.
“The reactions from citizens at the grassroots level toward the equity tax have drawn serious attention from the government. Our commitment to moving forward while listening to the people’s demands and building an equitable society remains unwavering and clear.
“All decisions of the government are and will be made with the welfare of the citizens at the centre. If citizens are dissatisfied with any decision, the government will always be ready to revise and amend it,” the prime minister said.
Welcoming the decision, the main opposition Nepali Congress urged the government to also roll back the five per cent value-added tax (VAT) on household electricity consumption, which came into effect from the current fiscal year.
The government last month announced a five per cent VAT on household electricity consumption exceeding 50 units a month, triggering widespread criticism.
“Electricity is no longer a luxury but a basic necessity. It is essential for cooking, education, information technology, small industries, electric vehicles and many other daily activities. It is therefore not appropriate to impose additional tax on household electricity consumption,” Nepali Congress Parliamentary Party leader Bhishma Angdambe said.
He urged the government to immediately withdraw the tax and instead encourage greater use of electricity by households.
