“Local mills are not in a position to compete with the importers of Indian refined flour as they are invoicing the product at Rs 16 per kg at customs whereas Nepali refined flour is selling for Rs 27 per kg in the domestic market,” said Pradeep Man Baidhya, chairman of Tax and Revenue Committee of Federation of Nepalese Chambers of Commerce and Industry (FNCCI). [break]“All 27 refined flour mills will collapse if the government fails to take necessary measures to check under-invoicing.”
Speaking at an interaction on ´Implementation of Budget of the Fiscal Year 2010/11’ organized by FNCCI on Sunday, Baidhya asked the government to fix the tax for refined flour at the rate mentioned in invoice, which is higher than existing price in domestic market, so as to strengthen the competitive power of the Nepali flour mills.
Around Rs 24 billion has been invested in 27 refined flour mills. Nepal consumes refined flour worth Rs 2.5 billion every year.
Constituent Assembly member Bimal Kedia also asked the government to immediately do the needful in protecting domestic refined flour mills that are losing competitive power due to rising inflow of under-invoiced Indian refined flour.
“Domestic flour mills are struggling hard to continue their operation and many are facing closure. It is high time the government reviewed invoicing system at customs,” Kedia said.
Speaking on the occasion, Revenue Secretary Krishna Hari Banskota assured businesspeople that the government was installing internet-based model to control under-invoicing of goods at customs points.
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