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Nepal Budget 2019-20
Nepal Budget 2019-20
Financial Year 2076-77 (2019-20)
Pramod Kumar Swarnkar (Partner)
The Hon’ble Finance Minister, Dr. Yuvaraj Khatiwada presented annual budget of 1532 billion (PY Rs.1,315 billion) on May 29th, 2019 for the financial year 2076-77 (2019-20) through Finance Bill, 2076.
This budget has highly prioritized the qualitative reform of lifestyle by fulfillment of fundamental rights of the citizens.
There has been significant progress in financial, social, physical infrastructure and reconstruction in the country. Investment friendly laws and infrastructural development has enabled Nepal to become an attractive location for foreign investment. Equitable development of prosperous social oriented economy by upgrading to medium income earning country within 2030 A.D.
Out of the total budget, Rs.957 billion (62%) as against previous budget of Rs.845 billion (64%) will go to recurrent expenditure, Rs.408 billion (27%) PY Rs.314 billion (26%) to capital expenditure and Rs.167 billion (12%) PY Rs156 billion (12%) for financing provision (i.e. principal payment of loans). The size of budget is 14% (PY 3%) more than previous year’s budget.
The budget aims to collect Rs. 981 billion (64%) (PY Rs.831 billion) from revenue, Rs58 billion (4%) (PY Rs.59 billion) from foreign grants, Rs. 298 billion (19%) (PY Rs.253 billion) from foreign loan and Rs.195 billion (13%) (PY Rs.172 billion) from internal loans.
The GDP growth is estimated at 8.5 % (PY estimated 7%)and inflation rate at 6 % (PY 6.5%).
The key highlights in the budget, how it affects the individuals and corporate business entities in Nepal, as well as overseas entities proposing to do business in Nepal are outlined in here.
The Income Tax, Education Service Tax, Vehicle Tax etc. contained in the Finance Act, 2076 (2019) will apply to financial year starting from 1st Shrawan 2076 (i.e. July 17, 2019). Value Added Tax (VAT), Customs Duty, Excise Duty, Health Service Tax and Infrastructure Tax provisions shall apply immediately on its announcement.