May 1, 2020

The Tax Laws (Amendment) Ordinance, 2020 includes measures intended to provide relief to the construction sector in view of economic consequences of the coronavirus (COVID-19) pandemic.

The Amendment Ordinance grants status of “industry” to the construction sector, and offers several time-bound tax relief measures for builders and developers that complete their projects by September 2022. Many of these concessions are optional. Those who decide not to opt for the tax rates may continue to be taxed under normal tax regime.

The Amendment Ordinance also grants immunity from audit regarding source of investment, subject to fulfillment of certain conditions.

The Amendment Ordinance is silent on any exemptions from sales tax or excise tax (duty) on construction material, and there is also no relief from capital gains tax on commercial property or open plots.

(This article is reproduced from KPMG site for general information purpose only. Nepal Tax Online do not vouch for the veracity of information copied from the site )