May 19: The Revenue Advisory Committee has recommended the government to monitor ecommerce businesses and digital payment to facilitate revenue collection in the country. In a report submitted to the Ministry of Finance (MoF), the committee has suggested the government to formulate tax policies to sustain the growing online business that has boomed with the COVID-19 pandemic and bring it under the network of tax. 

The report submitted to the Finance Minister Bishnu Poudel suggests programmes that the government should include in the budget of the upcoming fiscal year. It has also suggested the government to bring timely reforms in the tax system. 

The report states that a detailed study is required to change the revenue structure. It has suggested to look into the demands raised by the private sector regarding VAT issue and form an appropriate policy. 

Other subject matters of the report include providing compensation packages to the tourism and service sectors, review customs revenue, changing excise duty structure and studying the rate of excise duty being levied on special items. It has recommended the government to adopt a policy that avoids duplication of tax in the three levels of the government.

Mahesh Dahal, chairman of the committee, said that suggestions have been provided to the government to adopt investment-friendly tax policies to increase production, employment opportunities and attract private sector investment. 

"The report has recommended the government to be mindful of new areas of tax as well as tax policies that the government should introduce in the upcoming fiscal year," said Dahal.

The Revenue Advisory Committee is an independent body that has been providing recommendations to the Ministry of Finance to carry out tax reforms since 2019. It is authorized to act as a think tank on revenue issues. It carries out interactive programmes in all seven provinces with the participation of the private sector to gather revenue-related recommendations.