Businessmen Urge Finance Minister to Revoke VAT Decision on Potatoes and Onions

The Nepal Agricultural Produce and Potato, Onion Import Export and Wholesalers Association have submitted a memorandum to the Ministry of Finance, urging the government to revoke the provision in the budget that introduces a value-added tax (VAT) on agricultural produce.

As part of the Economic Bill announced for the upcoming fiscal year 2080/81, the government included provisions for VAT on items such as potatoes, onions, and apples.

The businessmen contend that this arrangement will lead to increased prices for imported vegetables, ultimately impacting consumers in their households.

According to the association, imported potato and onion, as agricultural products, are already subjected to a 9 percent agricultural reform fee and a 5 percent income tax.

The union argues that the addition of a 15 percent VAT will result in a 30 percent overall increase in the cost of imported vegetables and agricultural produce at the point of import.

The association has requested the finance minister to withdraw the decision to implement value-added tax on potatoes and onions, asserting that such a move by the government will discourage businessmen and burden consumers with higher prices.