Context:
Nepal’s tax administration and revenue policy have so far been insufficiently efficient and effective to finance a socially sustainable and green economic development. The elimination of corporate subsidies, difficulties in undertaking financial transactions, and declining foreign investment require increased government revenue to support the economy.
At the same time, the barriers are often so high that Nepalese micro, small, and medium-sized enterprises do not file tax returns. This applies in particular to micro-entrepreneurs and women-led firms. Furthermore, the tax authorities are not adequately capable of collecting taxes, whereas international standards are inadequately implemented.
Objective:
Nepal's tax administration and revenue policy have established the regulatory and practical conditions necessary for a sustainable economic development.
Approach:
The project advises tax authorities on how to take into account the economic, social, and environmental impacts of their measures and to design revenue policies accordingly.
By redesigning central IT systems, it simplifies and standardizes processes within the tax administration. This makes the administration significantly more efficient and effective in the long term.
In addition, the project trains tax authority staff and taxpayers so that both sides comply with regulations thereby contributing to enhanced government revenues. It also contributes to improving the general financial literacy of women entrepreneurs. It specifically encourages the participation of female civil servants in specialized tax training courses.
The project coordinates all activities with its partners to closely align them with the priorities of the government and the conditions in Nepal.