Himal Press 
KATHMANDU: The Confederation of Nepalese Industries (CNI) has urged the government to recognize the private sector as the engine of development and ensure policy stability for the next 10 years.
During a meeting with Finance Minister Bishnu Paudel on Friday to provide suggestions for the 2025/26 fiscal year budget, CNI called for consistent economic policies to encourage private sector investment.
CNI has suggested introducing a multi-tier VAT system (0%, 5%, 13%, and 18%) and lowering the minimum turnover threshold for VAT registration. These measures, according to the CNI, would reduce the cost of Nepali products, making them competitive with Indian goods and helping curb unauthorized imports. Likewise, it has suggested
consolidating various taxes and continuing only limited tax headings like income tax, customs duty, excise duty and value-added tax (VAT).
CNI has proposed that customs duties on raw materials used in production should be at least two tiers lower than those on finished goods.
The private sector body has also called for a gradual reduction of the income tax rate on manufacturing industries to 10% and the reinstatement of tax exemptions on export income for export-oriented industries.
It has also suggested to the government to simplify stringent laws governing the sustainable use of forest resources, timber, non-timber products, herbs, stones, gravel, water, limestone, mines and minerals. CNI has proposed a centralized tax collection system, with the state distributing revenues across various tiers of government.
