KATHMANDU, July 22: The government has decided to form a five-member taskforce to study concerns raised by the private sector over the implementation of vehicle consignment tracking system (VCTS), VAT in the transportation sector, and mandatory PAN for all salaried workers, among other issues.

“The taskforce will have two representatives each from the Ministry of Finance and Federation of Nepalese Chambers of Commerce and Industry (FNCCI) and a tax expert,” Pashupati Murarka, the immediate past president at FNCCI, told Republica.

The taskforce will have to submit its report to the government by Friday.

The taskforce was formed following a meeting between Minister for Finance Yuba Raj Khatiwada and an FNCCI delegation led by its President Bhawani Rana about the implementation of VCTS, mandatory Personal Account Number (PAN) to the workers and trading through PAN bill, among other issues, according to Murarka.

Dirgha Raj Mainali, director-general of the Department of Revenue Investigation (DRI) was also present in the meeting.

“The minister has assured us that there can be some adjustment in policies, circulars or related acts," Murarka told Republica.

The private sector has requested the government to implement online-based VCTS in a phase-wise manner. “The government can enforce the provision on importers and industries right away. But it should give some time to wholesalers,” Murarka said, adding that users need trainings and orientations to get used to the new system.

Under VCTS, details of any container or truck carrying commodities for the purpose of wholesale trade must be registered in the online-based tracking system before transportation. The tracking system is aimed at controlling revenue leakage through smuggling and minimizing malpractices in the transportation of domestic products. Officials of Department of Revenue Investigation, importers and entrepreneurs can get real-time update about the movement of cargo and consignments.

In the meeting, FNCCI representatives also raised the issue of mandatory PAN for salaried workers. "There is no problem in making PAN mandatory for permanent workers. But it will be difficult to enforce the system for temporary and wage-based workers," said Murarka.

He added that there are technical and practical problems to implement the provisions made mandatory by the government from the current fiscal year. 

Bus and transport entrepreneurs and transport workers have already demanded that the government scrap VCTS that came into effect from July 17, 2019.

According to the VCTS, transport entrepreneurs will be liable to fines of up to Rs 50,000 for the first time and Rs 75,000 for the second time if they do not abide by the rules laid down in the VCTS. 

However, the punishment is not confined to fine. When transport entrepreneurs fail to abide by the rules laid down in the VCTS, their vehicles carrying them will also be seized by the security personnel, according to the provision made in the VCTS.

 
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