Local bodies cannot collect tourism fee: Federal affairs and local dev ministry

Published On: November 2, 2017 08:59 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU, Nov 2: The Ministry of Federal Affairs and Local Development (MoFALD) has requested rural municipalities and municipalities to stop levying fee on foreign tourists for entering their respective areas.

Issuing a circular to all municipalities and rural municipalities on Wednesday, the ministry said that though local bodies can collect tourism fee as per the Constitution of Nepal, 2015, they cannot collect entrance fee for entering their boundary according to the Constitution of Nepal, 2015, Local Level Governance Act, 2017 and Inter-Governmental Financial Management Act, 2017.

The ministry issued the circular after the decision of Khumbu Pasang Lhamu Rural Municipality of Solukhumbu to levy entrance fee of Rs 2,000 on every foreign tourist entering its boundary drew criticism from all quarters. 

Tourism entrepreneurs openly criticized the decision saying that sudden imposition of fee has put additional financial burden on them.

The Khumbu Pasang Lhamu Rural Municipality has been maintaining that Schedule 5, 6 and 8 of the Constitution of Nepal, 2015 authorizes them to collect tourism tax. However, the circular issued on Wednesday by the ministry states that Sub-clause 1 of Clause 64 of Local Level Governance Act 2017 has mentioned that the tax on trekking and tourism can be determined and collected by the provincial government only. 

This Clause also mentions that the rural municipalities and municipalities are only allowed to charge entrance fee on gardens, park, zoo, historical and cultural places, and museums. 

Such fee has to be determined based on different factors like investment, operation cost, and maintenances fee, among others, as per the Clause 4 of Inter-Governmental Finance Management Act, 2017, the circular reads.

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