FNCCI presents suggestions for policies and programmes for fiscal year 2025/26

By A Staff Reporter,Kathmandu, Mar. 21: The Federation of Nepalese Chambers of Commerce and Industry (FNCCI) has presented suggestions for policies and programmes for fiscal year 2025/26. 

A delegation of FNCCI led by its president Chandra Prasad Dhakal presented the suggestions to Minister for Industry, Commerce and Supplies Damodar Bhandari on Wednesday.

While presenting the suggestions, President Dhakal praised the laws recently amended by the government, and said that necessary regulations and procedures should be made for their implementation and that implementation of the regulations should be guaranteed at all levels. 

"The policy amendment has sent a positive message," he said, “but for its implementation, implementation of the regulations should be guaranteed from all sides."

The Federation has suggested that the use of technology is necessary for business registration, renewal, revenue payment arrangements and cancellation. 

It suggested that a provision should be made in the policy and programme for the upcoming fiscal budget to provide all business services through a 'Business Icon' in the Nagarik App. 

The Federation has suggested that all government services should be streamlined in the name of smart services.

As foreign investment has been limited to 0.2 per cent of the gross domestic products in the last two years, the Federation also suggests that a programme called Investment in Nepal Campaign should be widely implemented in Nepal and abroad to raise investment resources. 

The FNCCI said that the Investment Board Nepal and the Department of Industry need to be merged and restructured. 

For the full implementation of the One Stop Centre, arrangements should be made so that investors do not have to go elsewhere after submitting their files, it said.

Since there is a trend of sudden changes in revenue-related laws by bringing the Fiscal Act every year, it is necessary to prepare a unified code of laws and pass it through the Parliament.

Due to the problems in cooperatives and microfinance, facilities such as refinancing should be provided to small and medium entrepreneurs for easy flow of funds, said the FNCCI. 

In terms of exports, FNCCI said that the policies and programmes should be immediately introduced to export Nepali agricultural products and water to the Gulf countries. 

Similarly, the Federation has also suggested providing facilities to entrepreneurs under the Start-up Nepal, Small Entrepreneur Development Programme and Technology-Based Prosperity Programme.

As extensive tax awareness, skilled manpower, systemic infrastructure are required to move to a multi-rate VAT system and a task force including the private sector should be formed immediately to make necessary preparations for it, said the FNCCI. 

The FNCCI has proposed to start implementing reduced rates as a piloting for some goods and services that are having difficulty operating due to the single rate of VAT from the budget for fiscal year 2025/26.

The FNCCI has proposed to start the implementation of the Single Rate of Value Added Tax (CVST) from the budget of FY 2082-83 as a solution to some goods and services that are facing difficulties due to the single rate of VAT.

The tax levied on manufacturing industries should be gradually reduced by 5 percentage points in five years. Similarly, the Federation has also drawn the attention of the government to reduce the income tax rate and increase the tax exemption limit.

The Federation suggested that measures should be taken to promote domestic industries, taking into account the impact of the pandemic on domestic industries.