•  CA. Shankar Thapa

Budget points related to Direct Tax 

1. Tax rates of 15% and 25% replaced with new tax rates of 10%,20% & 30%. Additional 20% tax to be imposed on taxable income exceeding 20 lacs. 

2. Non taxable limit for capital gain tax decreased from 30 Lac to 10 lac.

3. Dividend tax exemption for reinvestment of accumulated gain for capital creation in the business itself expanded to include all production and tourism industries. 

4. Industries employing more than 100 employees will get tax benefits. 

5. 50% income tax exemption proposed for Tea, Textile and Dairy industry. Income tax waiver for 5 years proposed for micro industries and additional 2 years’ waiver if such industry is run by women. 

6. 10% Income Tax concession for 3 years proposed for the private companies with paid up capital more than 50 crores that convert to public company. 

7. 20% Income Tax concession proposed for community hospital. 

8. Waiver of Income Tax and Fines proposed for Social Organizations that submit financial statements under current Income Tax Act. 

9. Exemption from Social Security Tax proposed for the person participating in contribution based pension fund.

10. Deduction limit for life insurance premium increased to NPR 25000.

Budget Points related to #IndirectTax:

1. VAT registration compulsory for person transacting on Alcohol, Cigarette, Sanitary, Electronics and Construction materials.

2. Health Tax and Education tax repelled. Private health service provider not required to collect VAT. 

3. Fine on non filing of VAT waived for those VAT registered party who would like to regularize. 

4. Excise increased on alcohol, cigarette, cars above 1000 cc, bikes above 150 cc and excised imposed on coca mixed chocolate, perfume, toys and refrigerator.

5. Health Risk Tax introduced on cigarette at the rate of 0.25% per cigarette

6. 75% customs and 100% VAT and excise waived for import of 1 bus above 30 seating capacity by Community School.

Source : CA Shankar Thapa