-  Thursday 01 October 2020

IRD to enforce excise stickers soon

KATHMANDU, Feb 10 - After much controversy and a delay of over a year, the government is finally set to enforce the program of labeling excise stickers on liquor bottles and cigarette packs.
“Inland Revenue Department (IRD) has completed all necessary procedures,” said Acting Director General of IRD, Rana Bahadur Shrestha.

Talking to the Post, he said that the department was receiving the first consignment of stickers from overseas printers on Saturday, which would pave way for the early enforcement of the program.

Shrestha, however, said that the department has not fixed the date of enforcement as of yet, as it was still to give specifications of labeling to the concerned business firms.

According to him, the department would discuss the process and requirements of labeling excise stickers with concerned entrepreneurs before deciding on the date of implementation.

The IRD has called the meeting on February 27, during which manufacturers would be informed about the excise label and criteria they would need to meet while labeling.

For the labeling, the department had asked the manufacturer to set up a machine in the plant last year. However, the manufacturers have been deferring the installation demanding specification of stickers, saying that it was necessary to determine the type of machines required for the purpose.

“We will discuss the matter during the meeting,” said Shrestha, adding that the department could pledge additional time to the manufacturers to get hold of the equipments.

The government had announced the program to label excise stickers on every liquor bottles and cigarette packs in the budget speech for 2004/05.

The program was devised after a study reckoned that the existing system of labeling excise sticker on cartons left enough room for the manufacturers to evade taxes. The study of Ministry of Finance (MoF) estimates that excise revenue leakage in liquor industry alone stands well over 40 percent.

Moreover, it decided to print the stickers from the overseas printers especially after IRD's investigation unearthed incidents of liquor companies using the fake excise stickers.

However, owing to a strong resistance coming from the concerned entrepreneurs and technical complexities faced in selecting the international security printer, the overall pace of its enforcement was slowed down.

As the department has already started receiving stickers under the first purchase order (FPO), IRD officials expressed optimism of its implementation within the next two months.

Perum Perumnas, the Indonesian firm selected through a global bidding, has been contracted to make supply of a total of 800 million excise stickers within a period of a year.

“Under the FPO, the IRD will receive a total of 300 million stickers on Saturday,” said Shrestha.

The excise stickers, which have been ordered in 16 different types, possess multiple security features and each type would specify the specific strength of liquor and sizes of bottles. Likewise, those come in different colors to be used for duty free and duty paid bottles.

The Kathmanud Post

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