Govt to issue tax ID from next week

KATHMANDU, Aug 22: The government will start distributing personal tax identification (ID) card to all income earners from next week.



According to the Inland Revenue Department (IRD), the distribution will begin on August 24 with the president, prime minister, ministers and other high-profile officials getting ID cards in the first phase. It will then be gradually implemented to government employees and other income earners. [break]



Shanta Bahadur Shrestha, IRD chief, said the program would kickoff with President Dr Ram Baran Yadav registering at permanent account number (PAN) and getting tax ID on the day. “We have already collected income and other details from the ministers to formalize the process,” he told myrepublica.com, adding that the design of the card too has been finalized.



The PAN ID card will bear ID code of the cardholder and one can easily get income details and tax clearance statements from the Inland Revenue Offices (IROs) by producing it.



Introduction of tax ID, which was announced in the budget that made registration at PAN mandatory for all income groups from 2009/10, will initiate a new revenue regime wherein all the taxpayers of the country will be known by their tax ID numbers and not their names.



All the firms and individuals will need to cite ID number of persons or firms whom they pay for services and goods. IRD too will maintain electronic details of all income earners at the tax offices -- a move that will not only widen tax base, but will also plug leakage of tax from multiple jobholders and service providers.



When revenue offices enter income details in the spreadsheet, it will record all incomes and transactions of a PAN ID cardholder in a single window. This will enable the tax office to consolidate everyone´s income and establish tax liability accordingly at the end of every fiscal year, helping control revenue leakage from professionals and service providers engaged in multiple firms.



The government believes that the effective enforcement of the new system will generate additional revenue of Rs 1.50 billion. It will also enable taxpayers to get tax clearance report instantly.



The government believes the enforcement of the program will bring in additional 200,000 taxpayers under PAN net by the end of this fiscal year. It also believes that the program will raise the incidence of tax compliance.



The IRD has already trained IROs across the country and District Treasury Offices for maintaining taxpayers´ records and issuing ID cards.

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