Govt raises income tax exemption ceiling by Rs 50,000

KATHMANDU, July 13 : In what comes as a sigh of relief for middle-class earners, the government has increased income tax exemption ceiling.

Presenting the budget for the fiscal year 2014/15 on Sunday, Finance Minister Dr Ram Sharan Mahat announced that income tax ceiling individuals has been raised to Rs 250,000, up from Rs 200,000. Similarly, income tax exemption limit for couple has been raised by Rs 50,000 to Rs 300,000.

This means individuals having annual income of Rs 250,000 or less and couple having total income below Rs 300,000 will not have to pay any income tax.

Likewise, the government has said that it would form a high-level tax review committee to improve taxation system.

“The committee would comprise of government officials, experts, former bureaucrats and private sector representatives, among others. It would prepare a detailed report, suggesting the government on overall tax policy or direction for 10/15 years,” Ram Man Duwadi, deputy director general of Inland Revenue Development, told Republica. “The committee will also take account of various taxation issues like policy, threshold and exemption, among others.”

The government had also decided to exempt taxes television sets of up to 32-inch brought along by overseas returnees (staying abroad for at least a year).

 Similarly, the government has said that it would make it mandatory for all individuals, agencies and professionals drawing salary, allowance and other facilities from the government bodies and treasury to acquire Personal Account Number (PAN).

As part of the taxation reform system, the government said it would allow the tax administration control and access taxpayer´s transactions records through IT system. Likewise, the government is introducing Equipment Identify Register System working procedure to rein the illegal import and use of mobile phone sets.

The government also plans to build necessary infrastructure for tax e-payment system along with providing information to taxpayers through electronic medium.

Finance Minister Dr Mahat has also announced that the government would review the provision that requires foreigners to voluntarily announce at customs point if they are carrying more than US$ 5,000 or equivalent foreign currencies.

There is good news for firms installing cable car system. According to the budget speech, such firms will get 50 percent discount in import duty for cables, readymade cabs and steel sheets.

Source: Republica