The Gandaki Province government has announced a sweeping 75 percent tax exemption for manufacturing industries and enterprises that provide employment to more than 200 individuals.
The incentive was introduced by the Minister for Economic Affairs Dr. Tanka Raj Gurung while presenting the provincial budget for fiscal year 2025/26 at the Provincial Assembly on Sunday, June 15.
According to Dr. Gurung, the budget prioritizes attracting external investment in key sectors such as agriculture, tourism, energy, forestry, and mining to spur job creation and alleviate poverty. The package of measures, which includes tax breaks and other schemes, is aimed at enhancing the province’s appeal to investors.
As a centerpiece of its investment drive, the government will launch a targeted intervention program titled ‘Invest Gandaki’, designed to strengthen the provincial economy. The budget also outlines a revenue policy that emphasizes expanding economic activity, promoting entrepreneurship, and encouraging domestic production.
While Gandaki Province has yet to mobilize internal borrowing, legal and institutional mechanisms for doing so will be established in the upcoming fiscal year. The government plans to channel such borrowing exclusively into employment-generating and high-yield projects.
To offset potential revenue losses resulting from tax exemptions, the province will expand its tax base in other areas. The ongoing rebate on land registration fees will continue, and fees for legal documents related to joint or partitioned land ownership have been revised.
Land transfers between landowners and tenants will be exempt from service charges. Additionally, owners of public buses, minibuses, and microbuses that offer discounted fares to senior citizens and persons with disabilities will receive a 60 percent discount on vehicle taxes.
Read: Gandaki Allocates Nearly 60% of Rs 31.97 Billion Budget to Capex
The budget also underscores the importance of the private sector in driving economic growth and highlights the role of public-private partnerships in facilitating investment.
Dr. Gurung noted that the budget supports the objectives of the province’s second five-year plan, focusing on growth, job creation, and holistic development under the guiding vision “Self-Reliant and Prosperous Province, Happy Citizens.”
The provincial government estimates an economic growth rate of 4.88 percent at basic prices and 5.51 percent at consumer prices for the current fiscal year—up from 3.78 percent and 4.9 percent, respectively, in the previous year.
For fiscal year 2025/26, the government has brought a Rs 31.97-billion budget, Rs 1 billion less than the current fiscal year’s. Of this, Rs 12.63 billion is earmarked for recurrent expenses and Rs 19.09 billion for capital expenditure.
RSS
