Close Ties

THE friendly and cordial relations that subsist between Nepal and the People’s Republic of China is an exemplary one. It is since times immemorial that both the countries have enjoyed each others respect and cooperation. There is no area where there is any misunderstanding between the two countries. In fact, this bilateral relation can be taken as a model. In this respect, over the years, because of the excellent rapport that exists between the two countries, there has been a great amount of mutual cooperation between these two friendly countries. Consequently, Nepal has been able to gain much from the cooperation extended by its northern neighbour. China’s desire to see Nepal prosper is adequately reflected by its strong support of the Nepalese government’s efforts to maintain law and order and thereby create a peaceful atmosphere. In Nepal’s bid to contain the terrorist activities of the Maoists, China has adequately supported the move. This was, furthermore, elaborated at an interaction programme organised at the Reporters Club the other day. Speaking on the occasion, Ambassador of China to Nepal Wu Cong Yong said that China would never support the Maoists in Nepal and neither would it provide any shelter to them. This is a noteworthy moral support for Nepal from its neighbour. It is over three weeks that the State of Emergency was declared here, because of the spree of violence that the Maoists, since they were labelled as terrorists, resorted to. The activities of the Maoist terrorists to disturb the peace and harmony in the country have been thwarted by the deployment of the Royal Nepalese Army personnel. In the ensuing days after the declaration of emergency, the security personnel have been able to contribute much towards the return of peace in the affected areas. In the meantime, much arms, ammunition and equipment have been recovered. This speaks for the fact that the country is slowly returning to normalcy. Before this, the environment of terror that had been unleashed by the Maoists had had a negative impact in every sector. The government on its part has done well to enhance the security conditions in the country. The support of various friendly countries in the government’s efforts to contain terrorism has been very encouraging. Moreover, the Chinese envoy to Nepal also revealed that China is seriously considering the request Nepal has made to different countries for support after the declaration of the State of Emergency. This in itself is a reflection of China’s concern for a peaceful and stable Nepal and all Nepalese appreciate this friendly gesture of China.

Cooperate With VDIS

NO one likes to pay taxes, but as good citizens it is the duty of all to pay. As expected, the Voluntary Declaration of Income Scheme (VDIS) has come under attack from the business community already. At an interaction programme on Wednesday, President of Nepal Chamber of Commerce (NCC) accused the government of scaring the business community by announcing the VDIS at a time when the national economy is passing through difficult times. His argument was that the VDIS was announced in haste without consulting the business community. Indeed, Nepal’s economy is in bad shape at the moment. Due to a host of external and internal factors, the tourism industry, the country’s economic backbone, is down. And industries and businesses have been badly hit in recent times by the Maoist insurgency. There might be an iota of truth in what the NCC president says, but as the official of the Inland Revenue Department made it clear, the VDIS is targetted against tax evaders, not to discourage tax payers. The VDIS has given everyone until the January 12, 2002 to voluntarily declare all property and income that have been amassed without paying taxes. A flat 10 per cent tax is applicable. The government has even threatened to confiscate an property that has been amassed without paying the due tax. Nepal’s revenue yield is low largely because the tax base is very narrow. Any attempt to raise revenue by broadening the tax net or introducing new taxes has always been met with stiff resistance. In the early nineties, the government’s decision to levy wealth tax was nipped in the bud. And the Value Added Tax (VAT) met with such resistance from the business community that it even called a Nepal bandh (strike), once considered a monopoly of the political parties. But see what wonders the VAT has done. If in 2054/55, 4,959 firms were registered with the VAT, in 2057/58, this figure shot up to 21,758. If revenue of Rs. 7.12 billion was collected in 2054/58 through the VAT, then the yield was Rs. 12.89 billion in 2057/58. The VDIS can do similar wonders in raising internal revenue. With a state of emergency now in place to disarm the Maoist terrorist, the country needs a lot of resources. And a lot more will be needed to take development to the nooks and corners of the country. The business community would do well to understand that there cannot be security and development without resources. Certainly one cannot have the cake and eat it too.