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Sharp Hike in Taxes and Fees for Running Local Units

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Sharp Hike in Taxes and Fees for Running Local Units
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July 22: In the name of implementing federalism, the government is preparing to run the local units by increasing the taxes and non-tax revenue by multiple folds. The local units have more than doubled the charges under different heads effective from the current fiscal year.

The municipalities have doubled the charge for issuing citizenship certificates by ten folds.

Also, the charge for issuing birth and death certificates, migration certificate, pension cards among others have been increased to a great extent. There has also been a sharp increase in the fee for registration of firms and organisations.

The decision of the local units to increase the charges massively has drawn widespread criticism from different quarters of the society. Economists and consumers have said that the sharp hike will hit the people hard. They have argued that the government didn’t make proper assessment before increasing the taxes and other charges and also said that the government extensively aims to run the country by collecting taxes alone.

According to economist Chandramani Adhikari, there are two ways of increasing revenue. One is the expansion of tax net while the other is to increase the rate of tax. Although the former takes time, it is more sustainable while the latter is easy to implement but is unpopular among the people.

“It seems that the local units have adopted the easy way to collect revenue,” he said, adding, “However, the taxes they had been collection had not been reviewed for a long time.”

Meanwhile, activist Prem Lal Maharjan said that it is very much impractical for the local units to set the tax rate at their whims.

“This is the outcome of their sick mentality of running the government just by collecting taxes,” he added.

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