Industrialists welcome move to facilitate raw material imports, Urge implementation for investment boost

October 8, 2023, 04:16:11 PM |

KATHMANDU: The Council of Ministers has granted approval for a new customs bill, which is currently in the process of being registered in parliament. This bill introduces a significant provision allowing export-oriented industries to import industrial raw materials without incurring customs duty, aiming to bolster the country’s exports.

Under the proposed bill, industries engaged in exports through the banking system or domestically in convertible foreign currency will be eligible to import essential raw materials and auxiliary resources for production by providing a specified cash security.

This security will be refunded upon the completion of exports or the sale of goods in foreign currency. If industries fail to meet these conditions, the deposited amount will be directed to the revenue account, with an additional 15 percent fee, as outlined in the bill.

Renowned industrialist Rajesh Agarwal has praised this provision for its potential to boost the nation’s exports. However, he suggests that offering export industries the option to use a bank guarantee, rather than cash, for importing industrial raw materials would further enhance efficiency.

Agarwal also highlights the urgency of implementing this system to encourage investments and expedite the import process. He points out that existing customs and VAT payment procedures, coupled with lengthy production timelines and export subsidies, have been obstacles to investment. Therefore, a practical approach prioritizing bank guarantees for raw material imports would be highly advantageous for export-focused industries.

Moreover, Agarwal emphasizes the importance of simplifying procedures and ensuring that the Customs Act aligns with practical realities, rather than merely announcing concessions for energy-intensive industries.

Meanwhile, Punya Bikram Khadka, the director of the Department of Customs, has noted that the government is introducing a new customs bill, which encompasses the latest issues in line with international commitments.

This new bill largely maintains existing customs administration and inspection procedures while considering Nepal’s international commitments. Once enacted, it will replace the existing Customs Act of 2066 BS.

The bill also includes provisions for granting tax exemptions on fuel used in international flights, aircraft fuel, spare parts, equipment, and in-flight food and beverages.

Furthermore, the bill introduces regulations to exempt duty on low-value goods. Specific items and their respective price thresholds eligible for duty exemption will be outlined in the regulations for goods imported or exported through the post office. Notably, the new customs bill does not stipulate a minimum duty collection requirement.

To enhance customs administration, the new bill introduces a provision mandating distinct uniforms, identity cards, and badges for customs employees. It requires customs officers to wear the designated uniform while performing their duties.

Fiscal Nepal |

Sunday October 8, 2023, 04:16:11 PM |