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Amend laws related to economic sector every 5 years: FNCCI

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Kathmandu, May 13, 2016: Country’s leading private sector organization has urged the government to review laws related to economic sector for creating business doing environment in the country.

The Federation of Nepalese Chambers of Commerce and Industry (FNCCI) presented its suggestions for the upcoming budget to the government on Thursday.”

“We have seen three constitutions in the past 26 years. But several laws like Black Marketeering and Some Other Social Offences Act are in force for the past four decades without any amendment,” Pashupati Murarka, president of FNCCI said.

The new constitution was promulgated on September 20 last year.

Over three dozen laws related to economic sectors are in need of amendments. Similarly, new laws need to be endorsed to rejuvenate country’s economic sector. But the government’s Policies and Programs for Fiscal Year 2016/17 unveiled recently has not given priority to legal reforms.

FNCCI has urged the government to process laws that are awaiting amendments at the earliest and take initiative for amending laws at least every five year. “The legal clause that caps profit at 20 percent could have been contextual some forty years ago, not now. Such laws should be amended at the earliest is it discourages private sector,” added Murarka.

He also expressed objection over the act of arresting businessmen and sending them behind bars for involving in black market like serious criminals.

Major laws related to manufacturing sector, including Industrial Enterprise Act, Labour Act and Foreign Direct Investment Act, are already more than 23 years old.

FNCCI has also urged the government to streamline laws related to economic sectors as they contradict with each other. “Different interpretations of these laws have jeopardized business doing environment in the country,” Murarka said, adding: “Political and policy instability have proved costly for businesses and industries. Change in laws and policies should not impact enterprises that are already running.”

According to Murarka, medical colleges and sand and aggregate producers, which have invested millions of rupees to build infrastructures, have suffered a lot from policy instability. He also criticized the government for over-regulation and said its focus should be on encouraging enterprises and job creation instead.

Receiving FNCCI’s suggestions, Minister for Finance Bishnu Prasad Paudel tried to convince private sector saying that he has already tabled major principles and priorities of the government in the next budget.

Likewise, Nepal Chamber of Commerce (NCC) also presented its suggestions to the government on the same day. In its suggestions, NCC has urged the government to focus on building hydropower projects, and increasing industrial production and job creation by making meaningful investments in Fast Track and Second International Airport of Nijgadh, among others.

‘Increase income tax threshold’

Private sector has suggested to the government to increase income tax allowance threshold in the upcoming budget.

Presenting their suggestions to Finance Minister Bishnu Prasad Paudel, the Federation of Nepalese Chambers of Commerce and Industry (FNCCI) has suggested raising threshold to Rs 400,000 for individuals and Rs 500,000 for families.

Similarly, NCC has urged the government to keep the threshold at Rs 500,000 for individuals and Rs 600,000 for families.

At present, income tax allowance threshold is Rs 250,000 for individuals and Rs 300,000 for families.

Likewise, the private sector has also requested to the government to introduce a provision of voluntary declaration of assets and property once again.

The government has already provided such facility two times.