VAT on potatoes and onions is impractical and unnecessary: Agricultural Traders

Published On: June 13, 2023 09:42 AM NPT By: Republica  | @RepublicaNepal

KATHMANDU, June 13: Nepal Agricultural Produce and Potato, Onion Import Export and Wholesalers Association has stated that it is impractical to attract VAT on potatoes and onions under the Economic Act, 2080 BS.

In a press conference held in Kathmandu on Monday, the Association said that it is not appropriate to impose VAT on the business of potatoes and onions, which are essential items used in the kitchen every day.

Speaking at the press conference, Prakash Gajurel, Secretary General of Association, said that one point of the budget statement for the next fiscal year 2023/24 presented by the government on May 29 and the accompanying Economic Act, 2080 BS will have an adverse effect on businesses and consumers as well. He claimed that imposing VAT on essential agricultural products such as potatoes and onions at a time when prices are rising in the country has made it even more difficult for the common man to make a living. He clarified that in this case, even though the VAT has been paid in full, all the items will not be able to be sold in the market.

He also said that currently 14 percent tax is being paid on potato and onion with 9 percent agricultural service fee and 5 percent advance income tax. He claimed that paying an additional 13 percent tax in such a situation would directly or indirectly increase the daily expenses of the kitchen. He said that such a policy would shrink the business and the 13 percent VAT would increase the price of potatoes and onions by one-third.

The association has requested the government not to attract VAT on potatoes and onions as per the Economic Act, 2080 BS, as it is unfair, impractical, unnecessary, unjust and costly to attract VAT in the business of potatoes and onions.


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