The Finance Committee of the House of Representatives has directed the government to formulate a revenue policy that promotes domestic industries and internal production.

The Finance Committee took such decision during a meeting on Wednesday after receiving complaints from entrepreneurs and businesspersons that the government's tax policy was hurting their businesses, said Santosh Chalise, chairperson of the committee.

Representatives of gold and silver dealers, Ayurvedic medicine manufacturers, and iron and bamboo product producers had submitted petitions to the committee, expressing concern over what they called an impractical budget for the upcoming fiscal year (FY 2025/26).

Gold and silver entrepreneurs protested the government's decision to impose a 2 percent luxury tax and a 13 percent value-added tax (VAT) on items such as gold, silver, and diamonds.

Similarly, Ayurvedic medicine producers demanded the removal of the 13 percent VAT levied on Ayurvedic medicines, citing their status as essential health items.

Iron rod and bamboo stick manufacturers also urged the committee to reverse the 10 percent customs duty imposed on raw materials used in the production of iron rods.

Entrepreneurs from all three sectors warned that if the proposed tax rates in the fiscal budget are implemented, domestic industries would struggle to survive, leading to potential job losses.

In response, the Finance Committee stressed the need for the government to introduce tax policies that encourage local industries and safeguard employment.

The Economic Bill, 2082, which contains the proposed tax measures, is currently under review in the Federal Parliament awaiting approval. -- RSS