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Value Added Tax Act, 2052 (1996)
[Amended by Financial Act, 2068 (2011)] Date of Authentication and the Publication
2068.7.03 (27 Oct. 2011)
An Act Made to Implement Proposals Relating to Fin ance of the
Government of Nepal
Preamble
: Whereas, it is expedient to levy some charges, taxe s, duties,
cesses and fees, continue or alter the existing one s and also to amend the laws
in force relating to revenue administration in orde r to implement the proposals
relating to finance of financial year 2068/69 of th e Government of Nepal;
Now, therefore, be it enacted by the Constitution Assembly pursuant to
Sub-articles (1) of Article 83 of Interim Constitut ion of Nepal,2063 (2007).
1. Short title and commencement : (1) This Act may be called the
“Financial Act, 2068 (2010).”
(2) This Act shall come into force immediately.
30. Amendment to the Value-added Tax Act, 2052 (199 6): Of the Value-
added Tax Act, 2052 (1996),-
(1) Of Section 2,-
(a) The following Clause (f1) shall be inserted a fter Clause (f):
“(f1) “Group of companies or entities” means a grou p of
companies or entities in relation to which the foll owing
situation exists:
(a) If any business is carried on by a person or ag ent
member associated with the group of entities,

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(b) If any goods or services are supplied by the group of entities to any entity or group of other
entities associated with it,
(c) If any goods or services are supplied to the gr oup
of entity or member of the group,
(d) If the permanent address of operation of busine ss
of any two or more than two entitles is in the
same place, or
(e) If the group of entities is controlled directly or
indirectly by any one person or some persons.”
(b) The following Clause (h) shall be substituted for Clause (h):
“(h) “Consideration” means any thing to be obtained in
exchange for the price of any goods or services bei ng
supplied.”
(c) The following Clause (h1) shall be inserted a fter Clause (h):
“(h1) “Loan agreement” means a hire purchase agree ment or
financial lease.”
(d) The following Clause (k1) shall be substitute d for Clause (k):
“(k1) Electronic medium” includes approved means su ch
as the computer, fax, e-mail, internet, electronic
cash register/machine and fiscal printer.
(e) The following Clause (t) shall be substituted for Clause (t):
“(t) “Tax Officer” means the Tax Officer, Chief Tax Officer
and the Chief Tax Administrator appointed by the
Government of Nepal for the purpose of this Act, an d
this term includes a section office, director and d eputy

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director at the Department or such other officer
designated by the Government of Nepal authorizing to
exercise the powers of Tax Officer under this Act.”
(2) The following Section 4 shall be substituted f or Section 4:
“ 4. Jurisdiction of the Tax Officer: (1) The jurisdiction of Tax
Officer shall be as prescribed by the Government of Nepal.
(2) The Director General may also so designate a Tax Office as to inspect and monitor also the trans action of
taxpayers in other areas than those falling under h is or her
jurisdiction.”
(3) The following Section 5A. shall be substituted for Section 5A:
“5A. Tax not to be levied on transfer of ownership of
transactions: (1) Notwithstanding anything contained
elsewhere in this Act, in cases where a registered person sells
the transaction being carried out by him or her to any other
registered person or the transaction is transferred in the name
of his or her heir by virtue of his or her death, s uch transfer of
ownership shall not be subject to tax. The person r egistered in
so selling or transferring the transaction shall gi ve information
thereof to the Department as prescribed.
(2) Notwithstanding anything contained in Sub-secti on
(1), if any industry or business that is required t o be registered
or has been registered pursuant to laws is transfer red, the
transferee who obtains the ownership shall bear the transferor’s
liability of tax specified by law.
(3) The person who obtains ownership shall, subject to
Sub-section (3), bear the obligation of safely main taining the

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accounts, records and books of account of the transaction of
such an industry or business until the prescribed p eriod (before
and after transfer) pursuant to this Act.”
(4) The following Explanation shall be inserted in Clause (c) of Sub-
section (2) of Section 6:
“ Explanation :
For the purposes of this Clause, acquisition shall be
deemed in the following circumstance:
(a) Copyrights, patents, licenses, trademarks and simil ar
other rights,
(b) Advertisement services,
(c) Technical services, engineering services, services of
suppliers providing technical services, legal servi ces,
accounting services, data and data processing servi ces,
information services and similar other services.
(d) In supplying the services as referred to in Sub-sec tion
(1) or accepting any liability or undertaking or in
exercising that undertaking fully or partly or doin g any
business activities in exercise of such right, or
(e) Insurance or reinsurance services other than the fa cility
of safe deposit.
(5) The following Sub-section (1) shall be substitu ted for Sub-section (1)
of Section 7:
“(1) The rate of tax to be levied pursuant to this Act shall be in
single rate of 13 percent.”
(6) Of Section 8: (a) The following Sub-section (2) shall be substitu ted for Sub-
section (2):

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“(2) A person, whether registered or not, who is the recipient
of services from a person who is not registered and is outside
Nepal shall have to assess and collect tax at the t axable value
in accordance with this Act and the Rules framed un der this
Act.”
(b) The following Sub-section (3) shall be inserted after Sub-
section (2):
“(3) Even though the construction of a building o r
apartment or shopping complex and similar other str ucture as
specified by the Department, of which value is more than Five
Million Rupees, and which is built for business pur pose is
procured from a person who is not registered, tax s hall be
assessed and collected from a person who has owners hip in
that structure as if such construction were procure d from a
registered person.”
(7) The following Section 8A. shall be inserted aft er Section 8:
“ 8A. Provision of bank guarantee: (1) An industry that
exports more than Sixty percent of the total sale o f the last
Twelve months after the operation of the industry m ay make
import by furnishing a bank guarantee with the conc erned Tax
Office in consideration for tax while importing the raw
materials required to produce the goods in the quan tity of
export, and import of goods to be imported for a du ty free shop
through a bonded warehouse may be made by furnishin g a
bank guarantee with the concerned Tax Office in con sideration
for tax leviable on such goods.

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Provided that, except for the import by a duty free shop
through a bonded warehouse, in order for the other exporter to
avail such a facility, the exporter has to make fin ished goods
from the raw materials, with Ten percent value addi tion.
(2) Liquors and cigarettes imported through a bonded warehouse availing the facility as referred to in Sub-
section (1) have to be sold only to the diplomatic and tariff
facility enjoying persons or bodies that are recomm ended by
the Government of Nepal, Ministry of Foreign Affair s.
(3) Liquors and cigarettes in stock at the duty free
shop situated at the Tribhuvan International Airpor t at the time
of commencement of this Act may be transferred to i ts own
bonded warehouse that has been licensed or be sold upon
paying leviable tax.
(4) The bank guarantee furnished pursuant to Sub- section (1) shall be released from the concerned Ta x Office in
accordance with the procedures specified by the Dep artment.
(5) A person who enjoys the facility as referred to in this
Section shall not be entitled to the facility as re ferred to in Sub-
section (4) of Section 24.”
(8) The following Section 9 shall be substituted f or Section 9:
“9. Exemption for small vendor: Notwithstanding anything
contained in the other provisions of this Act, an e xemption may
be provided to a small vendor, having a prescribed annual
taxable transaction threshold, from the requirement s of
registration and filing of tax returns and from suc h
requirements as may be prescribed.

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Provided that, if a small vendor wishes to have his or
her transaction registered voluntarily, he or she m ay have such
registration after completing the procedures as ref erred to in
Section 10.”
(9) Of Section 10,-
(a) The following Sub-sections (1) and (2) shall be substituted for
Sub-sections (1) and (2):
“(1) A person who intends to be engaged in any
transactions has to make an application, in the pre scribed
format, to the Tax Officer, for registration, prior to
commencing the transactions.
(2) If any goods transacted by a person is taxable or
if any person operates hardware, sanitary, furnitur e, fixture,
furnishing, automobiles, motor parts, electronics, marble,
educational consultancy, discotheque, health club, catering
service, party place business, parking service, dry cleaners
using machinery and equipment, restaurant with bar, and color
lab transactions within a Municipal Corporation, Su b-
municipal Corporation, Municipality or Depart or wi thin an
area specified by the Department, the person has to make an
application in the prescribed format, to the Tax Of ficer, for
registration, within Thirty days after the date of imposition of
such tax or the date of commencement of the transac tions.”
(b) The word “application” shall be substituted for the word
“petition” contained in Sub-section (4).

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(10) The following Section 10A. shall be inserted after Section 10:
“ 10A. Special provision relating to provisional reg istration: (1) In
the case of an exhibition, fair and similar other t ransaction to
be organized temporarily, the organizer and any ent repreneur
who carries on the transaction of any taxable goods or services
in such an exhibition or fair and is not registered with the
Value Added Tax shall have to be registered with th e Value
Added Tax temporarily. In the case of a person who is so
registered, the Tax Officer may require a deposit i n
consideration for security.
(2) An entrepreneur who has been registered with the
Value Added Tax since previously pursuant to Sub-se ction (1)
may take back through stock transfer the goods exhi bited in
that program.
(3) A tax payer who has been registered only for the
program as referred to in Sub-section (1) shall hav e to cancel
the temporary registration by furnishing the detail s of
transaction and paying all the leviable tax within Seven days
after the completion of the organized exhibition or fair.”
(11) Of Section 11,-
(a) Of Sub-section (1),-
(1) The following Clause (c) shall be substituted f or
Clause (c):
“(c) In the case of a partnership firm, if such partnership firm is dissolved or the partner
dies,”

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(2) The following Clause (d1) shall be inserted after
Clause (d):
“(d1) If the taxpayer is one who gives zero return or does not give return at all within
a consecutive period of One year,”
(3) The following Clause (1b) shall be inserted aft er
Clause (1a):
“(1b) A taxpayer has to submit his or her documents for auditing within fifteen days of the
submission of the tax returns for cancellation of
registration, and the Tax Officer shall perform
the audit of such a taxpayer, cancel the
registration within Three months or if registration
is not to be so cancelled, the Tax Officer shall
give information thereof to the taxpayer. If the
Tax Officer does not cancel registration or make
decision to cancel registration within that period,
the taxpayer is not obliged to furnish the tax
returns subsequent to that period.”
(b) The following Sub-section (3) shall be substituted for Sub-section (3):
“(3) Out of the goods that have already enjoyed the tax deduction facility, the stock
(capital goods as well) remain available for use at
the time of the cancellation of registration shall
be deemed supplied at the market price and tax
shall be assessed and recovered accordingly.

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Explanation : For the purposes of this Sub-
section, “capital goods” shall mean any property
or any part of property and property that is used
in taxable transactions.”
(c) The following Sub-section (4) shall be substituted for Sub-section (3):
“(4) If any act and liability as required to be performed and borne pursuant to this Act shall
be due by the reason of commission or omission
of any act at the time of carrying on taxable
transaction, the cancellation of registration of
such a taxpayer shall not in self result in the
exemption of such a taxpayer from the
consequence of such a liability.”
(12) The following Clause (b) shall be substituted for Clause (b) of
Sub-section (2) of Section 12:
“(b) Excise duty, ownership fee and other taxes sav e the tax
imposed under this Act.”
Explanation
: For the purposes of this Clause, “other tax
amounts” means such tariffs, fees and charges as ar e
specified and levied by the yearly Financial Act.
(13) The following Section 12A. shall be inserted a fter Section 12:
“12A. Taxable value of timber transaction: (1) There shall
be levied and collected tax on the amount of royalt y of the
timber of national forest or the amount of auction, whichever is
higher, at the time of auction, release or saw orde r, whichever
is earlier.

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(2) If the timber of a personal cultivated, private
forest or community forest for business purpose and despite
that royalty is not chargeable, tax shall be leviab le as if it were
the timber of national forest.”
(14) Of Section 14,-
(a) The following proviso shall be inserted in Sub- section (1):
“Provided that, a person who carries on annual
transaction of more than One Million Rupees shall i ssue
invoices with serial number and permanent accounts
number as well as his or her name, and address desp ite
that he or she is not registered.”
(b) The following Sub-sections (4), (5), (6) and (7 ) shall be
inserted after Sub-section (3):
“(4) One who transports goods attracting tax of more than Ten Thousand Rupees outside the area
specified by the Department shall hold tax invoices with
him or her.
(5) The Department may order taxpayers to
issue invoices by using a cash machine or computer.
Other procedures on so issuing invoices by using a cash
machine or computer shall be as prescribed by the
Department.
(6) The Department may, by publishing a
notice or giving an order in writing, so specify th at any
person specified by such a notice or order has to m ake
public the retail sale value or price of any such g oods as
specified in that order or notice for such period a s

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specified therein. No sale or transfer of any goods shall
be made without making public the retail sale price after
the receipt of such a notice or order.
(7) Provision shall be made that any person
specified pursuant to Sub-section (6) shall, in sel ling
such goods to any unregistered persons, have to iss ue
invoices of the price made public in the specified format
and collect also the tax at the consumer level.
Provided that, any persons not so specified
pursuant to Sub-section (6) may issue invoices as
referred to in this Sub-section.”
(15) The following Sub-section (3) shall be inserte d after Sub-section (2)
of Section 15:
“(3) Notwithstanding anything contained in Sub-
sections (1) and (2), a Local Body or an internatio nal
organization or mission situated in Nepal or the Go vernment of
Nepal or public corporations doing transactions of goods not
subject to value-added tax shall have to collect or recover tax at
the time of sale of value-added taxable goods or s ervices.
(16) Of Section 16: (a) The following Sub-section (1a) shall be inserte d after Sub-
section (1):
“(1a) The Department may have continuous access to
the computer database of taxpayers.”
(b) The following Sub-section (3a) shall be inserte d after Sub-
section (3):

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“(3a) A person who carries on the transactions of
taxable goods or services but is not registered has himself or
herself certify the account of purchase and sale fo r each
financial year. The Tax Officer may at any time exa mine such
an account.”
(17) The following Section 16A. shall be substitute d for Section 16A:
“ 16A. Records processed by computer to be eligible a s evidence:
(1) Notwithstanding contained in the laws in force, the
records relating to taxpayer processed by the compu ter
installed in the Department or offices thereunder s hall be
eligible as evidence for purposes of tax, except as otherwise
proved.
(2) The Department may by publishing a notice,
make necessary arrangements on the issuance of invo ices,
maintenance of accounts, submission of tax returns and
payment through electronic medium.”
(18) The following Section 16B. shall be inserted after Section 16A:
“ 16B. Deduction of tax paid on goods in the event of loss: In the
event of loss and damage due to arson, theft, accid ent, wear
and tear or disruptive activity, deduction of value added tax
paid on the goods shall be allowed as prescribed.”
(19) Of Section 17,- (a) The following Sub-section (2) shall be substitu ted for Sub-
section (2):
“(2) Notwithstanding anything contained in Sub-
section (1), it may be provided that no deduction o r only a
partial deduction may be granted in the case of the prescribed

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goods that can be used for personal purpose or for business
purpose or for both purposes.”
(b) The following Sub-section (5a) shall be substit uted for Sub-
section (5a):
“(5a) The concerned taxpayer shall be allowed to de duct
tax paid on the capital goods that were imported or purchased
by entering into a loan agreement under financial l ease subject
to Sub-section (2).”
(c) The following Sub-section (5b) shall be inserte d after Sub-
section (5a):
“(5b) The concerned taxpayer shall be allowed to deduct tax paid pursuant to Sub-section (2) of Sect ion 8,
Section 12A. and Sub-section (3) of Section 15.”
(d) The following Sub-section (8) shall be inserted after Sub-
section (7):
“(8) Notwithstanding anything contained elsewhere in
this Section, the name of a taxpayer who dies not s ubmits the
tax returns for Six months consecutively shall be m ade public,
and if there is any amount due for tax deduction by such a
taxpayer, such amount may be suspended and his or h er
registration may also be suspended.”
(20) Of Section 18,-
(a) The words “or by registered post” shall be inse rted after the
words “before the Tax Officer” contained in Sub-sec tion (1).
(b) The following Sub-sections (1a) and (1b) shall be inserted after
Sub-section (1):

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“(1a) Notwithstanding anything contained in Sub-section (1),
a taxpayer in a district where there is no Inland R evenue Office
may furnish the amount of tax and tax returns to be paid and
submitted by him or her with the Office of Funds an d Accounts
Controller of the same district within the Fifteent h day of the
month in which he or she has to furnish the tax ret urns. The
Office of Funds and Accounts Controller shall forwa rd the
returns of tax and payment of tax so received to th e Inland
Revenue Office within Seven days.
(1b) The procedures for furnishing and forwarding the
returns pursuant to Sub-section (1) may be determin ed by the
Department.”
(21) Of Section 19,- (a) The following Sub-section (2) shall be substitu ted for Sub-
section (2):
“(2) If a taxpayer does not pay the tax within the time limit
specified in Sub-section (1), an extra charge of Te n percent per
annum shall be imposed on the amount of tax due and
outstanding.”
(b) Sub-section (3) is hereby deleted.
(c) The words “pursuant to Sub-section (2)” shall b e substituted
for the words “pursuant to Sub-section (2) or (3)” contained in
Sub-section (4).
(d) The words “pursuant to Sub-section (2)” shall b e substituted
for the words “pursuant to Sub-section (2) or (3)” contained in
Sub-section (5).

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(22) Of Section 20,- (a) The following Clauses (f), (g), (h) and (i) sha ll be inserted after
Clause (e) of Sub-section (1):
“(f) If supply is made to the group company by maki ng
under invoicing,
(g) If transaction is carried out by a person requi red to be
registered without being so registered,
(h) If sale is made without issuing invoices,
(i) If tax is collected by an unregistered person.”
(b) The following Sub-section (4) shall be substitu ted for Sub-
section (4):
“(4) In assessing the tax pursuant to Sub-section (1),
tax assessment shall have to be made within Four ye ars from
the date of submission of the tax returns. If the t ax assessment
cannot be made within that period, the returns so f iled shall
ipso facto be considered to be valid.”
(c) The following Sub-section (4a) shall be inserte d after Sub-
section (4):
“(4a) Notwithstanding anything contained in Sub- section (4), where any person has evaded tax by pre paring false
accounts or invoices or other documents or by fraud , the
Department may at any time issue an order for the
reassessment of tax.”
(23) Of Section 21,-
(a) The following Clause (c) shall be substituted f or Clause (c) of
Sub-section (1):

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“(c) By selling all or some of the properties of the taxpayer
through sealed quotations or auction at the same ti me or
various times.”
(b) Sub-section (2) shall be deleted.
(24) The following Section 22A. shall be inserted after Section 22:
“ 22A. Provision against tax evasion plan: Notwithstanding
anything contained elsewhere in this Act, if any ta xpayer
commits any of the following acts with mala fide in tention to
take advantage of tax, the taxpayer shall be deemed to have
committed enticement to evade tax through tax exemp tion
scheme, and the Director General may order the Tax Officer to
assess the tax of such a taxpayer and recover the s ame:
(a) To lessen the liability of tax by making or doi ng any
scheme or act with mala fide intention to evade tax by
manipulating any provision contained in this Act,
(b) If any person or entity does any act with mala fide
intention to lessen the liability of tax or enters into
agreement with that intention.”
(25) The following Sections 23C. and 23D. shall be inserted after Section
23B.:
“ 23C. Purchase of goods of under invoicing: (1) If any person sells
any goods by under invoicing, showing the selling p rice lesser than
the prevailing market price, the Tax Officer shall, notwithstanding
anything contained in the laws in force, withhold t he goods in stock
similar to those goods so under invoiced and sold a nd the Inland
Revenue Office may purchase or cause to be purchase d the same at
the price under invoiced and sold.

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(2) If, in purchasing or caused to be purchased the goods by
the Department or Office pursuant to Sub-section (1 ), such a person
does not agree to sell the goods, the Department of office shall take
such goods in its custody, make calculation on the basis of the price at
which they were under invoiced and sold and make pa yment when
such a person shows up to receive payment.
(3) The goods purchased or caused to be purchased
pursuant to Sub-sections (1) and (2) may be sold or caused to be sold
at such price and in accordance with such procedure s as may be
specified by the Director General.”
“ 23D. Power to make search, seizure or demand deposi t or security: (1)
If the Tax Officer finds that any person, firm, compan y or
organization has done transaction by evading tax an d there is a
possibility that the accused may go away or the evi dence and proof of
offence may disappear, the Tax Office may, with the approval of the
Director General, do or cause to be done any of the following acts:
(a) To seal the place of transaction,
(b) To take custody of the electronic equipment or
records thereof,
(c) To demand cash deposit or wealth guarantee in a
sum equivalent to the tax evaded from the person
believed to have committed the offence, by
executing a memorandum to that effect,
(d) To withhold the bank account in the name of
taxpayer for up to Three months.
Provided that where the tax assessment
procedures have not been completed, the bank
account may be withheld for an additional period

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of Three months with the approval of the
Director General.
(e) To take into custody upto a period of Forty Fi ve
days not exceeding Fifteen days at a time till one
does not pay cash deposit or give wealth
guarantee pursuant to Clause (c)
(2) The Tax Officer shall have the same powers as t he
police may exercise under the laws in force in rela tion to the
investigation of offences pursuant to this Act.”
(26) The following Sub-section (4) shall be substit uted for Sub-section (4)
of Section 24:
“(4) Notwithstanding anything contained in Sub-sect ions (2)
and (3), any registered person whose export sales f or One month are
40 percent or more of his or her total sales for th at month, and submits
an application following the procedures set forth i n this Section for
the refund of the amount that is deductible pursuan t to Section 17
shall be entitled to a refund of the remaining exce ss in lump sum after
adjusting any outstanding amount.”
(27) The following Sub-section (5) shall be substit uted for Sub-section (5)
of Section 24:
“(5) On the submission of an application pursuant t o Sub-
section (3) or (4), the Tax Officer shall refund th e amount held to be
refundable, and if such an amount is not refunded w ithin Thirty days
after the date of submission of application in rela tion to the matter
referred to in Sub-section (3) and within Sixty day s in relation to the
matter referred to in Sub-section (4), the Governme nt of Nepal shall
have to provide interest on that amount, as prescri bed.”

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(28) The following Section 24A. shall be inserted after Section 24:
“ 24A. Tax not to be refunded: (4) Notwithstanding anything
contained in Section 24, if an application is not m ade for the
refund of the amount refundable pursuant to this Ac t within
Three years after the date of expiration of the per iod of tax,
such refund shall not be made.”
(29) Of Section 25,- (a) The following Clause (a) shall be substituted f or Clause (a) of
Sub-section (1):
“(a) If a foreign county grants on reciprocity that tax
exemption facility to Nepalese diplomats whom the
Government of Nepal, Ministry of Foreign Affairs, h as
granted diplomatic recognition or to persons enjoyi ng
diplomatic facility and serving in regional or
international missions or institutions, the amount of tax
paid by the Nepal based diplomats of such country o r
regional or international missions or institutions to the
extent of consumption by them.”
(b) The following Sub-section (1a) shall be inserte d after Sub-
section (1):
“(1a) Notwithstanding anything contained in Sub- section (1), the tax paid by a diplomatic body or d iplomat on
the purchase of taxable goods or services shall not be refunded
if the amount purchase is less than One Thousand Fi ve
Hundred Rupees at one time.”
(30)
The following Sections 25A. and 25B. shall be inse rted after Section 25 :

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“25A. Refund of tax paid by foreign tourist on purch ase: If a
foreign tourist visiting Nepal and returning by air purchases
taxable goods of more than Fifteen Thousand Rupees and takes
them with him or her, the tax paid on such goods sh all be
refunded in accordance with the procedures specifie d by the
Department.
25B. Return of tax at the customs point in the case of re-export:
If any goods are re-exported, the concerned Customs Office
shall, on the basis of the evidence of re-export of the goods,
make refund out of the deposit amount in considerat ion for the
value added tax with the customs by the concerned p erson.”
(31) The following Sub-section (2) shall be substit uted for Sub-section (2)
of Section 26:
“(2) For the purposes of Sub-section (1), the rate of interest shall be
Fifteen per cent per annum.”
(32) The following Sub-section (1a) shall be insert ed after Sub-section (1)
of Section 28:
“(1a) If any goods manufactured or prepared within Nepal,
after the completion of export procedures by the Cu stoms Office or
after reaching a foreign country, are re-imported b ecause of rejection
by the concerned party or other reason, and the sam e goods are to be
exported within Three months of the import, the goo ds may be
released against the deposit of the value added tax leviable at the time
of such return, and the deposit shall be refunded a fter the re-export of
such goods. The concerned Customs Office shall prov ide the details
of amount so furnished as a deposit and refunded to the Inland
Revenue Office.”

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(33) Of Section 29,-
(a) Of Sub-section (1),- (1) The following Clause (a) shall be substituted f or Clause
(a):
“(a) In the event of violation of Sub-section (1) o r (2)
of Section 10, Ten Thousand Rupees for every
tax period.”
(2) The following Clause (b1) shall be inserted aft er Clause (b):
“(b1) In the event of failure to place a tax board in
accordance with this Act or the Rules framed
under this Act, a fine of Two Thousand Rupees
for each week and in the event of failure to place
it at the designate place, a fine of One Thousand
Rupees.”
(3) The following Clause (c) shall be substituted f or Clause (c):
“(c) In the event of violation of Sub-sections (1) and
(4) of Section 14, Five Thousand Rupees for each
instance.”
(4) The following Clause (d) shall be substituted f or Clause (d):
“(d) In the event of violation of Section 15, cent
percent amount of tax collected.”
(5) The following Clause (g1) shall be inserted aft er Clause (g):
“(g1) In the event of violation of Sub-section (3a) of
Section 16, One Thousand Rupees for each
instance.”

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(6) The following Clause (l) shall be inserted after Clause
(k):
“(l) If a taxpayer who has obtained permission to making computer billing is found to have used a
software deleting and correcting data, Five
Hundred Thousand Rupees.”
(b) The following Sub-section (1a) shall be inserte d after Sub-
section (1):
“(1a) In the event of lessening tax liability witho ut observing
this Act or the Rules framed under this Act, the Ta x
Officer may fine up to Twenty Five percent of the
amount of tax, on the grounds as specified by the
Department.”
(c) The following Sub-section (2) shall be substitu ted for Sub-
section (2):
“(2) If a person commits any of the following offen ces, the
Tax Officer may impose a fine of cent percent of th e
amount of tax or an imprisonment up to Six months o r
both the fine and the imprisonment on such a person :
(a) Preparing false accounts, invoices or other documents;
(b) Committing an evasion of tax by fraud;
(c) If an unregistered person acts as if he or she were
a registered person;
(d) Infringing Section 23C.;

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(e) Carrying out a transaction by infringing Section
30.”
(d) The following Sub-section (3) shall be insert ed after Sub-
section (2):
In a case, an accomplice (accessory) who knowingly or
negligently assists, helps, abets or provides advis e to a person
who commits an offence as specified in this Act, he /she shall
be liable for a fine of Fifty percent of the tax am ount which
such a person has not paid (or paid the lesser amou nt) .
(34) The following Section 29A. shall be inserted after Section 29:
“ 29A. Power of Department to order to furnish the am ount of
fine: (1) Notwithstanding anything contained elsewhere i n this
Act, if any person, prior to the commencement of pr oceedings
of action, admits in writing that he or she has com mitted
another offence or more than such offence set forth in Sub-
section (2) of Section 29, the Department my order such a
person to furnish the amount of fine not exceeding the amount
of fine imposable for the commission of such an off ence.
(2) In issuing order as referred to in Sub-sectio n (1),
such an order has to set out the details of such of fence, amount
of fine to be paid and date for payment of the amou nt of fine.
(3) An order issued by the Department pursuant to
this Section shall be final.”
(35) The following Section 30A. shall be inserted after Section 30:
“ 30A. Power to order for reassessment of tax: (1) In cases where,
before tax is assessed, it appears from the informa tion given to
the Director General that any action relating to th e assessment

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of tax is about to be irregular or has been irregular, the Director
General may, by executing a memorandum clearly sett ing out
the reasons, give direction to the concerned Tax Of ficer to
make reassessment of tax or order any other Tax Off icer to do
that act.
(2) In cases where it appears that tax liability ha s
increased because of tax assessment made by the Tax Officer
recklessly or with mala fide intention, the Directo r General
may give order to amend such tax assessment order w ithin
Four months after the date of initial tax assessmen t.”
(36) The following Section 31A. shall be substitute d for Section 31A:
“ 31A. Application may be made for administrative review : (1) A
person who is not satisfied with any decision of ta x assessment
made by the Tax Officer may make an application to the
Department against the decision within Thirty days of the date
of receipt of a notice of that decision.
(2) In cases where the time limit for making applic ation
pursuant to Sub-section (1) expires and any person makes an
application for the extension of time limit within Seven days
from the date of expiration of the time limit, the Department
may extend the time limit for a period not exceedin g Thirty
days from the date of expiration of the time limit.
(3) If the claim of the applicant appears to be tru e
upon examining the evidence and documents including the
application made by the taxpayer pursuant to Sub-se ction (1),
the Director General may, by executing a memorandum setting
out the clear reasons, void that tax assessment ord er and direct

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the concerned Tax Officer to make re-assessment of tax or
order any Tax Officer to do that act.
(4) The Department shall make decision on the
application within Sixty days after the date of mak ing of
application pursuant to Sub-section (1).
(5) If the Department does not give decision within the
time limit as referred to in Sub-section (4), the c oncerned
person may make an appeal to the Revenue Tribunal p ursuant
to Section 32.
(6) The taxpayer who makes an application pursuant
to Sub-section (1) has to pay undisputed amount of tax, out of
the amount of tax assessed, and furnish a cash depo sit of One
Third of the amount of tax in controversy.
(7) In cases where excess of the amount to be
furnished pursuant to Sub-section (1) has been furn ished prior
to the making of application, only the remaining am ount upon
deduction of the amount covered by that amount may be
furnished as deposit.
(37) The following Section 32 shall be substituted for Section 32:
“ 32. Appeal in the Revenue Tribunal : (1) A person who is not
satisfied with an order of suspension made by the D irector
General pursuant to Section 30 or a decision made b y the
Department pursuant to Sub-section (4) of Section 3 1A. may
file an appeal in the Revenue Tribunal.
(2) The person who files an appeal pursuant to Sub-
section (1) has to register a copy of the appeal wi th the
Department within Fifteen days of the date of filin g appeal.”

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(38) The following Section 32A. shall be inserted after Section 32:
“ 32A. Advance ruling: (1) If any person makes an application in
writing to the Department for the removal of any co nfusion as to the
application of this Act, the Department may issue i ts version by an
advance ruling as prescribed, by notifying the pers on in writing.
(2) Notwithstanding anything contained in Sub-secti on (1), the
Department shall not be entitled to issue an advanc e ruling referred to
in Sub-section (1) on any matter of confusion occur red in the
implementation of this Act in cases where such matt er is sub- judice
in the court or has already been decided by the cou rt.
(39) The following Section 34A. shall be inserted after Section 34:
“ 34A. Power to have expert’s service : The Government of Nepal
may obtain the service of the concerned expert for the act
related to tax auditing; and the provision on gover nmental
secrecy mentioned in Section 37 shall also apply to such an
expert.”
(40) The following Sub-section (1) shall be substit uted for Sub-section (1)
of Section 40:
“(1) A person who provides information, along wi th
evidence, showing that a taxpayer has evaded or att empted to evade
all or some portions of his or her tax liability ma y be awarded, by a
decision of the Director General, as reward the amo unt that is equal to
Twenty per cent of the amount of tax recovered on t he basis of that
information.”
(41) The following Schedule-1 and Schedule-2 shall be substituted for
Schedule-1 and Schedule-2:

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“
Schedule-1
(Relating to Sub-section (3) of Section 5) List of VAT exempt goods and services
Group 1. Basic Agricultural Products
(a) Paddy, rice (heading 10.06), wheat (heading 10. 02), maize (heading
10.05), barley (heading 10.03), millet (sub heading 10.08.20),
buckwheat (sub heading 10.08.10), pulses (heading 0 7.13), flour and
rye flour(heading 11.02), grains (heading 11.04), p addy flakes
(heading 19.04), peas, beans, chickpeas and kidney peas (heading
07.08 and 07.13) and similar basic unprocessed food materials and
their extracts,
(b) Green and fresh vegetable (from heading 07.01 t o 07.11, 07.12.20)
(except sub heading 07.03.20), fresh fruits (from h eadings and sub
headings 08.01.19, 08.03, 08.04.30, 08.04.40, 08.04 .50, 08.05,
08.06.10, 08.07 to 08.10), fresh eggs (sub heading 06.03.10), tuberous
roots, corms, fruits, and vegetables and fresh and unprocessed agro-
products, except those to be supplied to hotels, re staurants, bars, guest
houses, cafeteria and other similar organizations)
(c) Unprocessed cash crops/cereals (such as sugarca ne (sub heading
12.12.99), cotton (heading 52.01), cardamom (sub he ading 09.08.30),
ginger and saffron (sub heading 09.10.10), flax (he ading 53.01 and
sub heading 53.03.10)), unprocessed tobacco, tea le af sold by
farmers(sub heading 09.02.10 and 09.02.20), tea che st (sub heading
44.15.10), coffee (sub heading 09.01.11 and 09.01.1 2), soybean
(heading 12.01),ground-nuts (heading 12.02), turmer ic(curcuma) (sub

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heading 09.10.30), oil-cake and other solid residues (headings 23.04
and 23.05)
(d) Herbs (including their extracts)
Group 2. Goods of Basic Needs: (a) Piped water, including water supplied by tanker s
(b) Fuel wood (sub heading 44.01.10)
(c) Coal (heading 44.02)
(d) Salt (sub heading 25.01.00.90)
Group 3. Live Animals and animal products
(a) Goats (sub heading 01.04.20), sheep and mountai n goats (sub heading
01.04.10), yak and buffalos (heading 01.02), bore a nd pigs (heading
01.03), rabbit (sub heading 01.06.19) and their unp rocessed raw
edible food items (from headings 02.01 to 02.04, he ading 02.06)
(b) Cows and she buffalos (01.02), she goats (01.04 .20), and their fresh
milk (04.01), (including pasteurized), curd (04.06. 100, bees
(01.06.90) and bee hives (44.15.100 and bee keeping machinery,
including germination plant, metal barrel, bee brus h, base roller, gear
pump and wheel plate (heading 84.36) and bee harves ting or threshing
machinery (heading 84.33)
(c) Ducks, hens, cocks, turkey and similar other bi rds 9heading 01.05)
their fresh meat and unprocessed raw items (heading 02.07) and eggs
(heading 04.07)
(d) Fresh or dried fish (other than packed) (headin g 03.01) (from sub
heading 03.02.33 to o3.02.36, except 03.02.700 (hea ding 03.03
(except sub heading 03.03.80, sub headings 03.07.41 and 03.07.49)

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4. Agricultural inputs (a) Crops, grasses, flowers or live trees and other plants, bulbs, tubers,
tuberous roots and bulbs and roots used as seeds (h eadings 06.01,
06.02, 06.04, and 12.09)
(b) Manure, fertilizer and soil conditioners (Chapt er 31)
(c) Hand tools, spades, shovels, mattocks, picks, h oes, forks and rakes,
axes, bill hooks and similar hewing tools, secateur s of any kind,
scythes, sickles, hay knives, other than hand saws, hedge shears,
timber wedges, ploughshare and other tools of a kin d used in
agriculture (heading 82.01)
(d) Insecticides, rodenticides, fungicides, herbici des and de-ratting drugs
as mentioned in Chapter 38 of Customs Tariff used o nly for crops
(sub headings 38.08.91.90, 38.08.92, 38.08.93, 38.0 8.99)
(e) Tractors (heading 87.01), cultivators (sub head ing 84.32.29), tantalum
(sub heading 84.32.21), levelers (sub heading 84.32 .80), harvesting or
threshing machine (heading 84.33), threshers (sub h eading 84.33.52),
fishing nets (sub heading 56.08.11), ready-made cag es for
aquaculture, fish incubators, pumping sets with eng ines from Two to
Eight horse power and up to 30 meters hose pipe acc ompanied with
the sets, used in irrigation works.
(f) Raw materials of deed supplements falling under Chapters 23, 28 and
29 of the Customs Tariff, animal feeds and feed sup plements falling
under Chapter 23 of the Customs Tariff, and lime st one dust, bone
dust and fish dust falling in Chapter 25.
(g) Special kind of utensils for feeding poultry fe ed except normal or
general utensils, and special kinds of utensils for feeding water to
poultry.

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Group 5. Medicine, Medical and Similar Health services
(a) Health services (other than health services pro vided by the institutions
registered with the value added tax)
(b) Human blood and human blood items and vaccines, (heading 30.020)
plastic blood bags, transfusion sets, testing kits, and various tools,
equipment and chemicals required for building reage nts and blood test
reagents that are imported by the Nepal Red Cross S ociety and
required for blood transfusion service,
(c) Human or animal organs or tissue for medical r esearch (heading
30.01)
(d) Medicaments for treatment of livestock and huma n beings and family
planning means (headings 30.03, 30.04 (except Chwanpras) sub
heading 40.14.10)
(e) Pacemakers used in treatment of heart diseases (90.21.50), equipment
required for the treatment of kidney disease, bath concentrate solid or
liquid used in dialysis (38.24.90), goods made for, and suitable only
for the use of, infirm and disabled persons, (inclu ding scooters)
987.13.10 and 87.14.20)
(f) X-ray film (sub heading 37.02.10) and oxygen ga s to be used for
treatment (sub heading 28.04.40) and bandage (headi ng 30.05).
(g) Raw materials for drug industries: metal salts, oxides and hydro-
oxides used by drug industries and in the productio n of IOL, falling
under Chapter 28 of the Customs Tariff, as well as raw materials of
drugs (active ingredients of drugs) and raw materia ls used by drug
industries in production of drugs or in production of IOL , and
packing materials and equipment falling under headi ngs 90.18 and

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90.27 used in the research and development of industries and hospitals
on the recommendation of the Department of Drug Man agement.
Group 6: Education (a) Research related acts in schools or universitie s
(b) Vocational or professional trainings or refresh er trainings provided by
institutions fully owned by the Government of Nepal ,
(c) Educational services provided by schools and un iversities.
Group 7: Books, newspapers and printed materials (a) Books, calendars, newsletters (headings 49.01, 49.02, 49.04) and
printing and publication thereof,
(b) Newsprint (heading 48.01)
Group 8: Artistic and cultural goods and services, carving s ervices
(a) Painting, handicrafts, carving and similar othe r handicrafts and related
services.
(b) Cultural programs,
(c) Admission fees to libraries, museums, art muse ums, zoos and
botanical gardens, and national parks.
Group 9: Passengers and goods transportation servic es
Air transport, passenger transportation (except cab al car) and goods carrier
service (except transportation related to supply) a nd cargo services for the
purposes of exports
Group 10: Personal or Professional service: Personal services rendered by artists, sportsperson s, authors, writers,
designers, translators and interpreters institution ally or individually, and
services of supplying human resources to foreign co untries.

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Group 11: Other goods or services:
1. Agriculture products storage services provided b y cold storage.
2. Postal services (only those provided by the Gov ernment of Nepal):
(a) Services of conveyance or transfer of letters, money and postal
packets,
(b) Other services required for the services of con veyance or
transfer of letters, money and postal packets,
(c) Postage stamps (heading 49.07),
(d) Services provided by the Government of Nepal.
3. Excise duty stamps and passports (heading 49.07) , cash machines (sub
heading 84.70.90)
4. Financial services, life insurance services and reinsurance services.
5. Bank notes, coins and cheque books:
(a) Printing and issue of bank notes, (b) Supply of bank notes from foreign countries int o Nepal
(heading 49.07).
(c) Cheque books
6. Gold and silver: (a) Gold (heading 71.08), gold coins (sub heading 7 1.18.90), gold
ornaments (heading 71.130 and diamond ornaments
(b) Silver (heading 71.06), and silver coins (sub h eading 71.18.90),
silver ready-made goods and ornaments (heading 71.1 3)
7. Electricity supply,
8. Raw wool (heading 51.01)

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9. Battery operated tempo (sub heading 87.03.21.10) and their chassis
(sub heading 87.06.00.15)
10. Bio-gas, solar power and wind power operated po wer generation
plants and their equipment and tubular battery, on the
recommendation of the Alternative Energy Promotion Centre.
11. Aircrafts and helicopters (heading 88.02(except sub heading 88.02.60)
and their engines (sub heading 84.09.10, gear box ( sub heading
88.05.10), fire brigades 9sub heading 87.05.30), am bulances and
corpse carrying vehicles (heading 87.02 and 87.03)
12. Jute batching oil (sub heading 27.10.19.13) and jute products
(headings 53.06, 53.07 and 53.10)
13. Mills, machineries and equipment, molding keys (except spare parts)
other than those that can be used in household attr acting up to 5
percent customs duty as falling under Part 84 of th e Customs Tariff.
14. Woolen carpet and woolen carpet weaving, dying, washing and
knitting.
15. 100 percent cotton sari, Lungi, Dhoti (for both men and women),
Gamcha and cotton yarn (headings 52.05 and 52.07).
16. Woolen yarn to be used in hand knitting sweater (except artificial and
acrylic) domestically.
17. Donated goods received for any natural calamiti es or philanthropic
purpose, as approved by the Ministry of Finance, Go vernment of
Nepal.
18. Goods of personal use that do not attract custo ms duty and are
imported under the Luggage and Baggage Order facili ty.

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19. Amount equal to such tax as deemed payable that remains balance
upon deducting the tax paid on purchase from the ta x collected on the
sale of goods by textile, match (only wooden stick) and tyre-tube
industries shall be refunded to these industries in accordance with the
procedures specified by the Department.
20. Only Twenty Five percent of the amount equal to such tax as deemed
payable that remains balance upon deducting the tax paid on purchase
from the tax collected on the sale of products (flo ur) by flour
industries shall be refunded to these industries in accordance with the
procedures specified by the Department.
21. Fifty percent value added tax of the value adde d tax collected by
domestic industries producing mustard oil on sellin g their products of
mustard oil and by industries producing Vanaspati ghee and other
processed edible oil domestically to the taxpayers registered with the
value added tax shall be refunded to these industri es in accordance
with the procedures specified by the Inland Revenue Department.
Provided that the packaging industries that import processed oil in
bulk and refilling the oil in consumer packages and sell the same shall
not be entitled to such a facility.
22. If any native industry that manufactures cellul ar mobile phone sets
and importer thereof submits evidence that they hav e sold the tax paid
on the raw materials of cellular mobile phone sets or readymade
goods to the taxpayers registered with the value ad ded tax, sixty
percent shall be refunded in accordance with the pr ocedures specified
by the Department.
23. Seventy y percent value added tax of the value added tax collected by
domestic industries producing sugar on selling thei r products to the
taxpayers registered with the value added tax shall be refunded to

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these industries in accordance with the procedures specified by the
Inland Revenue Department.
24. The value added tax shall be exempted in relati on to imports of such
machinery, equipment, tools and their spare parts, penstock pipes or
iron sheets used in making thereof as required for hydro power
projects and as are not produced in Nepal, on the r ecommendation of
the Alternative Energy Promotion Center, in the cas e of those which
are operated with the approval of that Center, and on the
recommendation of the Electricity Development Depar tment, in the
case of the industries except those which are opera ted with the
approval of the Alternative Energy Promotion Center .
25. The value added tax shall not be levied on tran sferring any motor
vehicles that were imported by any foreign mission or donor agency
with the enjoyment of the diplomatic facility or ta riff facility to the
project itself in consonance with the approval annu al program of the
project and converting their number plates into gov ernmental ones or
on transferring, with the approval of the Ministry of Finance, any
motor vehicles that were imported in the name of an y project with the
enjoyment of full or partial tariff facility (excep t those imported on
inventory or bank guarantee) to any governmental bo dy after the
completion of the project and converting their numb er plates into
governmental ones.
26. If any diplomatic body, project or other body ( governmental as well
as non-governmental organization) intends to scrap and cancel the
registration of any motor vehicle that it has impor ted with the
enjoyment of the tariff facility and that is more t han 15 years old after
the year of initial production, with the approval o f the Ministry of

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Finance, the value added tax shall not be levied on such a motor
vehicle.
27. If the owner of a motor vehicle imported by a c itizen of Nepal for
personal use with the enjoyment of value added tax exemption dies
and the motor vehicle has to be transmitted to the husband or wife of
the owner of motor vehicle, the value added tax sha ll not be levied on
such a motor vehicle on the basis of the approval o f the Department.
28. If any industries that have not enjoyed the fac ility of bonded
warehouse or passbook import the raw materials, sub sidiary raw
materials, and packaging materials that are not pro duced in Nepal,
required for the production of goods to be exported by them and
export the goods produced from such raw materials i n accordance
with such procedures and within such period as pres cribed, the value
added tax levied on such raw materials, subsidiary raw materials and
packaging materials at the customs points while imp orting them shall
be refunded from the customs point in relation to s uch goods, from
such a date and on such pro rata as specified in a notice published in
the Nepal Gazette.
29. The following goods to be imported in the name of Nepal Army,
Armed Police Force and Nepal Police Headquarters sh all enjoy
exemption, on the recommendation of the concerned M inistry:
(a) Ammunitions, arms, gunpowder and their spare pa rts, special
kind of oil, accessories, explosives to be used by Nepal Army,
Armed Police Force and Nepal Police, raw materials required
to produce army materials and machineries, tools an d spare
parts used for security.

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(b) Machineries and equipment required for maintaining peace and
security, crowd control materials, equipment and ot her goods
required for the investigation of crimes, and commu nication
materials to be used by personnel of Nepal Army, Ar med
Police Force and Nepal Police, on the recommendatio n of the
Ministry of Communication.
(c) Such equipment, materials, drugs and related go ods as required
for the treatment of Army personnel, armed police a nd Nepal
police personnel and of horses.
(d) Goods used in the exercise and training of Army , armed police
and Nepal police personnel.
(e) Heavy earth moving plant, tool and parts relate d thereto,
optical equipment used in engineering survey and co nstruction
works carried out by Nepal Army, and such defense s tore
goods as specified by the Ministry of Defense.
(f) Camping equipment used by Nepal Army and variou s goods
required for special force and paratroopers.
(g) Aircrafts, helicopters and their spare parts, p arachute
(including bags), tools, lubricants and ground equi pment
imported in the name of Nepal Army.
(h) Equipment and tools required for the operation of hospitals.
(i) Goods required for scientific laboratories.
(j) Goods used in natural calamity relief works.

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Group 12: Lands and buildings Purchase, sale and rental of lands and buildings (e xcept the services
provided by such entities carrying on business such as hotels and
guest houses)
Group 13: Betting, casinos and lotteries Activities relating to facilities provided for the organization of bets or
gambling, and lottery.
Note: (1) The value added tax shall be exempted only on t he goods and services
specifically mentioned in the foregoing headings an d sub headings.
The Department may, as required, and in consultatio n with the
Department of Customs, alter and revise the interpr etation of the
goods and services enjoying tax emption and the Har monized Code of
Commodities.
(2) Given that as mentioned above vanaspati ghee an d mustard oil, flour
and cellular mobile phone sets produced domesticall y enjoy partial
facility and tax refund is made accordingly, the In land Revenue
Department shall make provision of coordination inc luding the market
monitoring of these goods.
(3) If the Government of Nepal considers reasonable to grant any
exemption to any taxable goods or to refund tax, it may grant such
exemption by publishing a notice in the Nepal Gazet te.

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Schedule-2
(Relating to Sub-section (2) of Section 7) Goods and services subject to zero rate
1. Goods exported from Nepal: If it is proved that goods are supplied as
follows:
(a) Goods exported outside Nepal, or (b) Goods shipped for use as stores on an internati onal flight of which
destination is outside Nepal, or
(c) Goods put on board an international flight of w hich destination is
outside Nepal for retail sale or supply or consumpt ion.
2. Services to be supplied to persons outside Nepal :
(a) A supply of services by a person residing in Ne pal to a person outside
Nepal, who has no business transaction, business re presentative or
legally recognized agent in Nepal.
(b) A supply of goods or services by a person who i s residing and is
registered in Nepal to a person who is residing out side Nepal.
3. Goods or services imported by a person or missio n enjoying diplomatic
facility and a person serving in a diplomatic missi on enjoying tariff facility,
on the recommendation of the Ministry of Foreign Af fairs, Government of
Nepal.
4. If any previous treaty or agreement provides for the sales tax exemption on
imports, and local purchase is made from the regist ered taxpayers, on the
recommendation of the concerned project, the facili ty of zero rate shall be
provided on such supplies, so long as such treaty o r agreement is in effect.

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5. Raw materials to be sold to and goods manufactured by any industries
established pursuant to the laws in force and opera ted in the special
economic zone.
6. If, on the recommendation of the Alternative Ene rgy Promotion Center, the
battery used in the equipment and mechanism generat ing energy from solar
power is produced by any native industry and is to be supplied by that
industry, the facility of zero rate shall be provid ed to that industry on that
transaction on the recommendation of Alternative En ergy Promotion Center
and in accordance with the procedures specified by the Department.
7. If any machinery, equipment, tools and their spa re parts, penstock pipes or
iron sheets used in making thereof required for hyd ro power projects are
produced by any native industry and are to be suppl ied by that industry, the
facility of zero rate shall be provided to that ind ustry on that transaction, on
the recommendation of the Alternative Energy Promot ion Center, in the case
of a project that is operated with the approval of that Center, and on the
recommendation of the Electricity Development Depar tment, in the case of
one other than that operated with the approval of t he Alternative Energy
Promotion Center and in accordance with the procedu res specified by the
Department.
8. If painting, handicrafts, carving and similar ot her handicrafts produced a
cottage and small scale industry within Nepal are e xported through an
approved export trading house of Nepal, the value a dded tax paid on the raw
materials used in the manufacture of such goods sha ll be refunded after
fulfilling the procedures specified by the Inland R evenue Department.
9. The value added tax paid on the import or local purchase of scooters used by
persons with disabilities shall, if such scooters a re registered in their name in
the Office of Transport Management, be refunded on the recommendation of
the Women, Children and Social Welfare or the Chief District Officer of the

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www.lawcommission.gov.np
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concerned district, and in accordance with the procedures as specified by the
Department of Inland Revenue. If such goods are sol d to any persons other
than the persons with disabilities, the refunded va lue added tax shall be
recovered.