Do you know your rights as a Taxpayer?

We all are aware that taxes needs to be paid on any income earned from the income generating activities. There is no way we can remain untouched. There is a famous quote that only two things are certain in this life 1) Death 2) Taxes

There is huge compliance cost when it comes to taxation. Keeping a proper books of accounts, making sure that it is auditable and filing of periodic tax return. It notly only takes a lot of your time, money but also gives us a fear whether we haave done everything rightly or not? Whether there will be finess and penalities? 

I have seen people who are actually afraid to face tax officers and right letters to tax department. Most common reason is fear. We fear that anything we do or say will be held against us. We fear that we will not be given an opportunity to explain. But, that is not so true. Nepalese Income Tax Act, 2058 has assured certain rights for every taxpayer. These are fundamentals rights which we can exercise:

1) Right to respectful behavior

2) Right to receive any information related to tax as per the prevailing laws

3) Right to get an opportunity of submitting proof in tax matters

4) Right to appoint lawyers or auditor's for defense during tax-related litigation

5) Right to secrecy and to keep it inviolable

However, I feel these are still vague and require simplification. My rationale is that the easier it is to understand and less burdensome it is to comply more voluntary chances for 100% acceptance. Its a change in behavior of the tax office and its officers that would make tax administration more user friendly and approachable to common people. 

Then, I went to do some research on the topic and went through rights secured in some of the developed countries. The one from USA actually helped me retain my position. I really liked the way they have cleared out amibiguity. I was, in fact, impressed that they had even mentioned quality service as the fundamental right. The whole world and tax regime in Nepal would be different if only tax payers are treated as a customer. Here's the fundamentals rights mentioned in Taxpayer Bill of Rights:

1) Right to be informed

2) Right to quality service

3) Right to pay no more than that correct amount of tax

4) Right to challenge the Tax Office (they call it IRS) position and be heard.

5) Right to appeal an IRS Decision in an idependent forum

6) Right to finality

7) Right to privacy

8) Right to confidentiality

9) Right to retain representation

10) Right to a fair and just tax system

In the end, let me put a question to you:

1) How you feel when you visit Tax Office or interact with Tax Officers?

2) Do you feel Nepal Govt. and Inland Revenue Department has done enough to help you secure these rights?

Thanks for going our post. You know by now we are also on Instagram, TikTok and Facebook. Just search for @arthabicharnepal. 

Have a great day.