Kathmandu. It has been found that foreign air service providers who have made air fares twice as expensive on the pretext of reducing flight hours due to construction work at Tribhuvan International Airport have evaded taxes.
According to the Office of the Auditor General, air service providers who sold tickets to passengers flying to different destinations from Nepal have evaded taxes by not paying tax to the Government of Nepal as per the provisions of Section 70 of the Income Tax Act, 2058.
According to the Income Tax Act, 5 percent tax will be levied on the transportation of passengers departing from Nepal and 2 percent on air travel that does not depart from Nepal to another foreign country.
According to the 62nd annual report published by the Auditor General, 13 foreign airlines have been fined 2080 in the last fiscal year. They have evaded taxes while flying from Nepal to various destinations in 81. The Auditor General has suggested that an investigation should be conducted to recover the tax evasion of Rs 2.31 billion and the fees and interest levied on it.
According to the Auditor General, the two airlines flying to Dubai have evaded the highest total of Rs 880 million in taxes. Fly Dubai and Emirates have been flying on this route. Similarly, airlines operating flights to Hong Kong have evaded rs 369.4 million in taxes.
Apart from this, airlines flying to Malaysia have evaded tax of Rs 192.1 million. Similarly, airlines operating flights to Saudi Arabia have evaded rs 179.7 million in taxes.
Most of the 13 companies involved in tax evasion are foreign airlines operating flights to gulf countries.
