The government on the latest budget hearing for the fiscal year 2081/82, has decided to slap a 5% excise duty on laptops. This has raised criticism all over the Internet, with many labeling it as an incredibly dangerous act that might set us back for decades in this growing evolution of Information technology. Let’s dive into discussing more about the latest IT act, particularly that of the 5% Excise duty on laptops, where we further address the latest move by the government.
5% Excise duty on laptops Overview
On the Budget Announcement
In his budget speech for Fiscal Year 2081/82, the Honorable Finance Minister Mr. Barshaman Pun unveiled plans for the ICT sector. The substantial budget, totaling over Rs 1.863 trillion, encompasses a range of initiatives, including those for the IT sector and telecommunications.
About the 5% Excise duty on laptops
The government of Nepal decided to impose a 5% excise duty on laptops. Previously, laptops were only subject to the standard 13% VAT. This new excise duty will increase laptop prices. For example, let’s consider a laptop called BladeRunner, initially priced at NPR 100,000. With the 13% VAT, the price becomes NPR 113,000. After the new budget announcement, you’ll also have to pay an additional 5% excise duty, further raising the price.
And this is going to get superbad
Here’s the thing: a 5% excise duty might increase government revenue, but laptops are no longer a luxury. In today’s digital age, laptops are essential in every sector—IT, finance, tourism, education—everything depends on the Internet. Imposing a 5% excise duty will not only burden everyone but could also put the development of the IT sector in the graveyard
Here comes the Grey market
The increase in laptop prices is likely to cause a surge in the Grey market. This could lead to the accessories market being largely dominated by grey sellers, which will negatively impact authorized sellers who offer genuine products with VAT bills. However, it’s not just the authorized sellers who will suffer; the government will also be affected. A decline in revenue collection is imminent in the near future.
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5% Excise duty on laptops: Conclusion
The government of Nepal has made a significant blunder by imposing a 5% excise duty on laptops while claiming that “Nepal will become an IT hub in the upcoming years.” Laptops are already expensive, especially for students in rural areas, and this increase will make them even harder to afford. This move risks putting the dreams of young children to sleep forever, contradicting the government’s ambitions for the country’s technological advancement.
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