December 13: The government has shown lack of interest in reliving the public from the burden of double taxation and to create a conducive environment for investment.

Since the double tax exemption agreement was signed with Bangladesh on March 5, 2019, no such agreement has been signed with any other country. Even though the government sent a proposal to countries like Malaysia, Canada, Brazil, and the UAE a decade ago, no progress has been made in this regard so far. 

The files sent abroad could not be processed due to the lack of double tax exemption agreements on the priority of government officials. The tax exemption agreement has failed to make a headway for a long time because the government officials did not follow up on those files and did not respond to some of the proposals sent by those countries. The Income Tax Act of Nepal has given the government the right to enter into international agreements and double taxation exemption agreements. However, the government does not seem to prioritize it.

The government made many efforts to reach an agreement with Bangladesh. According to the then official, the tax exemption agreement was reached between the two countries after four attempts. The then prime minister and finance ministers showed special interest in it, which is not the case now. The government has signed double tax exemption agreements with 11 countries so far. 

On May 13, 1996, the first tax exemption agreement was signed with Norway. Then agreements were made with Thailand, Sri Lanka, Mauritius, Australia, Pakistan, China, Korea, Qatar and India respectively.

Homework has been going on for a decade with Malaysia, Singapore, the United Kingdom, America, Japan, Canada, Brazil, and Oman for a double tax exemption agreement. However, result-oriented progress has not been achieved. Officials of the Inland Revenue Department say that even though proposals have been received from those countries, no agreement has been reached so far. Ananda Gupta, director of the international tax branch of the department, admitted that after the agreement with Bangladesh, no agreement could be reached with any other country. He said, "Proposals have come from other countries, but we have not done it." He did not reveal the reason why there was not a single agreement this year. The tax exemption agreement benefits businessmen who do business in more than one country in the same income year. It is said that it will play a supporting role in financing foreign direct investment. 

According to Inland Revenue Department sources, although Malaysia, Canada, Brazil, the UAE, and Singapore have expressed their desire for a double tax exemption agreement, the Government of Nepal has shown no interest in this regard.