House panel gives telcos a month to clear taxes and fees

Published On: February 11, 2019 06:00 AM NPT

KATHMANDU, Feb 11: Parliament's Finance Committee on Sunday directed the government to recover all outstanding taxes and fees from the country's all nine telecommunications companies within a month.

The taxes and fees include income tax, value added tax, frequency fee, renewal fee and compulsory contribution to the Rural Telecommunication Development Fund.

The payables to the government by the telecommunication companies total Rs 2.96 billion, which accumulated over several years.

Among the nine companies, Smart Telecom owes the largest amount at Rs 1.4 billion. Likewise, United Telecom Limited and Nepal Satellite Telecom Pvt Ltd owe the government Rs 794 million and Rs 735 million, respectively.

The parliamentary committee has instructed the Ministry of Finance and Ministry of Communication and Information Technology to do needful to recover the amount, but the instruction will not apply to the capital gains tax of Ncell until the Supreme Court issues a full text of the verdict on Ncell buyout.

Companies failing to clear these taxes and fees should be barred from adding new services and facilities and increasing the capital among other things, according to the decision made by the committee.

The parliamentary committee has instructed the government to start the process to revoke the operating licenses of the companies that default on the payment after one month.

Surendra Aryal, secretary of the committee, informed that the committee has started reviewing earlier decisions made by different government agencies regarding Ncell capital gains tax assessment. “Especially after last week's Supreme Court verdict on Ncell buyout case, we believe that there are serious flaws in the government's tax assessment system,” added Aryal.

To review the CGT on Ncell buyout, the committee has ordered the ministries concerned to submit all the details of the shares transfer of Ncell and Spice Nepal Pvt Ltd, and all minutes of decisions and the names of the decision makers on CGT assessment at the Ministry of Finance, Nepal Rastra Bank, Inland Revenue Department, Large Taxpayers Office among others.

The committee has also instructed the government to submit within seven days any other decisions or orders made by the government agencies with regard to Ncell.

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