Jute mills get tax breaks while others cry unfair

BIRATNAGAR, MAR 24 -

Jute mills based in the Biratnagar have been given massive discounts on electricity charges. Around 10 factories have received exemptions on their energy bills worth Rs 120 million.

The government has been providing a 70 percent waiver on electricity charges citing the huge employment they provide. Also, the daily load-shedding has been cut by 5 hours for jute mills while other factories suffer the full length of the power outage.

Moreover, the government has exempted them from paying import duty on around 2,000 varieties of spare parts needed for the machinery used by them. Arihant Multifiber, Biratnagar Jute Mill, Raghupati Jute Mill, CM Jute Mill, Guheshwori Turban Plant, Baba Jute Mill, Swastik Jute Mill, Nepal Jute Industries, Chandra Shiva Jute Mill and Pathivara Jute Mill are among the jute mills receiving a 70 percent subsidy on the electricity tariff.

Meanwhile, other factories have been protesting against the favouritism being accorded to jute mills. According to the Nepal Electricity Authority (NEA), Raghupati Jute Mill has received a Rs 16.9 million subsidy on the power charges as of the first half of the fiscal year.

Likewise, Biratnagar Jute Mill has received subsidies amounting to Rs 2.56 million, CM Jute Mill Rs 845,000, Guheshwori Turban Plant Rs 1.47 million, Baba Jute Mill Rs 5.96 million, Swastik Jute Mill Rs 6.21 million, Nepal Jute Mill Rs 2.62 million and Chandra Shiva Jute Mill Rs 2.21 million. These eight factories have received exemptions totalling Rs 38.8 million.

Similarly, Arihant Multifiber has received customs exemptions amounting to Rs 58.6 million, Biratnagar Jute Mill Rs 2.12 million, Raghupati Jute Mill Rs 38.9 million, CM Jute Mill Rs 4.34 million, Baba Jute Mill Rs 97.93 million, Swastik Jute Mill Rs 11.5 million, Nepal Jute Industries Rs 38.44 million, Chandra Shiva Jute Mill Rs 37.78 million and Pathivara Jute Industries Rs 1.14 million.

Many manufacturers have been importing raw materials from third countries for use in their mills but re-exporting them to India instead. A industrialist complained that only jute mills have been provided huge exemptions on power charges and import duty on spare parts while other factories are forced to pay customs duty on spare parts that are as high as 38 percent. He demanded that the facility be extended to other companies too.

Source: The Kathmandu Post