KATHMANDU, DEC 16, 2012
Taking advantage of the weak legal framework and inefficient monitoring agencies, certain companies are not paying capital gain tax in the country, according to the Inland Revenue Department (IRD).
Lack of coordination among various government agencies has also contributed to the loss of capital gain tax, an official at IRD.
Companies must inform the Office of Company Registrar regarding changes in share structure, he said. “But even some big companies are flouting the provision and have not informed the Office of Company Registrar about changes in the share structure.”
It is not clear whether the Office of Company Registrar or tax administration is responsible for initiating action against companies who do not pay capital gain tax, he added.
Deputy director general at IRD Ram Sharan Pudasaini said that the department will share online information with the Office of the Company Registrar to scrutinise the companies. Tax administration will get access to the database of companies and can check whether or not there has been a change in share structure after the online information sharing between the department and Office of Company Registrar.
According to the existing legal provision, a capital gain tax of 10 per cent is charged for individuals and 15 per cent for institutions, said IRD.
The government has been collecting capital gain tax from the realty sector and even listed companies, the department said. “But the transaction and share transfer of non-listed companies is yet to be transparent and it is here that the tax administration and other responsible agencies should carry out investigations.”
Access for the tax administration to the profile of companies will help bring companies under the tax net, Pudasaini said. “However, information sharing will be effective for companies which update their activities to the Office of Company Registrar.”
The department will bring a separate plan of investigation to bring companies who are, allegedly, not informing changes in their share structure under the purview of the Office of Company Registrar.
The Office of Company Registrar is responsible for taking action on other flaws, he said, adding that the tax administration is concerned only about revenue collection.
No company — whether big or small — has the right to evade capital gain tax, said Pudasaini. “The department will try to bring all companies under the legal net.”
A capital gain tax is a tax on capital gains, the profit realised on the sale of a non-inventory asset that was purchased at a cost that was lower than the amount realised on the sale, according to IRD.
The most common capital gains are realised from the sale of stocks, bonds, precious metals and property. Taxes are charged by the state over the transactions, dividends and capital gains on the stock market.
Source: THT
Taking advantage of the weak legal framework and inefficient monitoring agencies, certain companies are not paying capital gain tax in the country, according to the Inland Revenue Department (IRD).
Lack of coordination among various government agencies has also contributed to the loss of capital gain tax, an official at IRD.
Companies must inform the Office of Company Registrar regarding changes in share structure, he said. “But even some big companies are flouting the provision and have not informed the Office of Company Registrar about changes in the share structure.”
It is not clear whether the Office of Company Registrar or tax administration is responsible for initiating action against companies who do not pay capital gain tax, he added.
Deputy director general at IRD Ram Sharan Pudasaini said that the department will share online information with the Office of the Company Registrar to scrutinise the companies. Tax administration will get access to the database of companies and can check whether or not there has been a change in share structure after the online information sharing between the department and Office of Company Registrar.
According to the existing legal provision, a capital gain tax of 10 per cent is charged for individuals and 15 per cent for institutions, said IRD.
The government has been collecting capital gain tax from the realty sector and even listed companies, the department said. “But the transaction and share transfer of non-listed companies is yet to be transparent and it is here that the tax administration and other responsible agencies should carry out investigations.”
Access for the tax administration to the profile of companies will help bring companies under the tax net, Pudasaini said. “However, information sharing will be effective for companies which update their activities to the Office of Company Registrar.”
The department will bring a separate plan of investigation to bring companies who are, allegedly, not informing changes in their share structure under the purview of the Office of Company Registrar.
The Office of Company Registrar is responsible for taking action on other flaws, he said, adding that the tax administration is concerned only about revenue collection.
No company — whether big or small — has the right to evade capital gain tax, said Pudasaini. “The department will try to bring all companies under the legal net.”
A capital gain tax is a tax on capital gains, the profit realised on the sale of a non-inventory asset that was purchased at a cost that was lower than the amount realised on the sale, according to IRD.
The most common capital gains are realised from the sale of stocks, bonds, precious metals and property. Taxes are charged by the state over the transactions, dividends and capital gains on the stock market.
Source: THT
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