Govt collects over Rs 12.8 billion in revenue from banks, financial institutions

Following the government's direction to the authority concerned to collect revenues gained from bargain purchase gains through premium of FPO (follow-on public offer), mergers and acquisitions and sale of auction shares, over Rs 12.8 billion in revenue has been deposited in the state coffers in two days.

The amount was deposited in the state coffers until Friday and Saturday (4 pm), said Director General of the Inland Revenue Department, Dirgha Raj Mainali. The deadline to pay the tax is today midnight. There is a provision that one paying the revenue by today will be exempted of fines.

Since the 57th annual report published in 2077 BS by the Office of Auditor General, the Office of Auditor General has been asking the government to recover the amounts in revenue from premiums of FPO, bargain purchase gains of mergers and acquisitions and auction share sales citing tax evasion in the process. However, the Ministry of Finance and the Inland Revenue Department had been ignoring the issue raised by the Office.

The issue has been raised in the 60th report of the Office. Following the raising of the issue of collecting taxes in its four consecutive reports, Finance Minister Dr Prakash Sharan Mahat made an arrangement that paying the taxes in the premiums of FPO, bargain purchase gains of mergers and acquisitions and auction share sales by the end of December 16 would be subject to the waiver of fines and interests. The government's move aimed to encourage the companies to pay the revenues on time, it has been said.

Following this, 16 commercial banks moved the Supreme Court against the minister's decision of giving exemptions on fees and fines alleging that the government was trying to impose taxes against the constitution.

On Thursday, the constitutional bench of Chief Justice Bishwoambhar Prasad Shrestha, justices Ananda Mohan Bhattarai, Sapana Pradhan Malla, Sushmalata Mathema and Kumar Regmi annulled the writ. With the annulment of the writ, the decision of the minister to grant exemption through the Financial Act was as per the law, it has been held.