By Our Reporter
Nepal Textile Association (NTA) withdrew its decision to shut down all industries across the country for a week.
The textile manufacturers on Sunday agreed to open their industries following an assurance from Finance Minister Dr. Yuba Raj Khatiwada to find an amicable solution to their problem.
Finance Minister Dr. Khatiwada had urged the industries to hold their protest at least for 10 days, but they agreed to open them for a week, according to Jitendra Lohia, NTA Vice President.
Blaming the government’s indifference to their demand to review its decision to annul the Value Added Tax (VAT) refund system through the budget of the current fiscal year 2018/19, the textile industrialists had decided to shut down the industries for a week bringing about 250 textile mills across the nation to a complete halt.
They had shut down all industries across the country from Saturday for a week as the government did not address their demand to adjust the Value Added Tax (VAT).
This move had brought about 250 textile industries to a complete halt, affecting the employment of about 50,000 workers.
The manufacturers were protesting the government decision to remove the VAT refund facility. They were enjoying 70 per cent VAT refund for the last two decades.
According to the entrepreneurs, the removal of VAT refund facility has increased the textile production cost by almost 9 per cent and made the domestic cloth even dearer.
India has 5 per cent Goods and Services Tax (GST) on domestically produced textile.
They said they were disappointed with the government’s counterproductive decision which forced the textile mills to cut their production by almost 50 per cent due to the increasing production cost.
Nepal needs about 1 billion 50 million metres of cloth for individual and commercial use. However, only 62.5 million metres is produced locally at present.