“While visions for long term investment promotion are welcoming moves, rampant taxes will help deepen the problem of recession”
KATHMANDU, June 6: The Federation of Nepalese Chambers of Commerce and Industry (FNCCI) has cautiously welcomed the budget for the fiscal year 2023/24.
Issuing a press release on Monday, the umbrella organization of the private sector hailed the government-forwarded programs that could be helpful to address the issues of long-term investment in the economy. “However, the budget has failed to introduce measures to minimize the impacts of the ongoing recession in the economy,” read the statement.
Rendering priority to the local products even if they are expensive up to 20 percent, provisions to promote cultivation in the barren land, development of special economic zones and industrial zones, subsidies to startups and simplification in official procedures to open new companies are among the few welcoming moves of the government that the FNCCI has mentioned. “However, revision in the rates and bases of direct taxes will adversely affect the economy by continuing the ongoing recession,” added the statement.
According to the FNCCI, the budget talks nothing about increasing liquidity flow, infrastructure construction and creation of aggregate demand, which are important components to solve the problem of recession. Likewise, imposition of rampant taxes without assessing the impacts on the general public and the entrepreneurs is the dark side of the budget, the FNCCI noted.
The government seems panicked to raise unnecessary taxes in order to generate more revenue to meet its target for the next fiscal year. “This will discourage the businesses at a time when the economy is reeling under the recession.”
Likewise, the FNCCI has slammed the government decision to impose VAT on the imported agricultural products. This has already helped hike the price of a number of farm products including fruits in the local market.
Meanwhile, the Federation of Handicraft Associations of Nepal has welcomed the annual budget for the fiscal year 2023/24, stating that it has attempted to raise the morale of the private sector by looking forward to broad-based and sustainable economic growth. Promotion of Make in Nepal and Made in Nepal campaigns, special economic zone, registration of collective trade mark in a number of countries are termed positive by the umbrella organization of handicraft producers.
The federation, however, expressed its dissatisfaction over the government apathy to enforcing the public-private-partnership model for implementation of certification and promotion of design of Nepali handmade products and establishment of craft village, among others.