Country facing potato and onion shortage after govt tries to force VAT

VAT on daily consumables - potato and onion
Image by Hans from Pixabay

Kathmandu, December 6

Potato and onion businesspersons are staging a strike after the government imposed VAT on the vegetables bought from Nepali farmers. This, businesspersons say, will cause a shortage in the market.

The budget for the fiscal year 2023/24 has stated that VAT would be imposed on imported vegetables. However, traders say this is being applied to potatoes and onions grown domestically as well.

“We cannot do business like this,” said Prakash Gajurel, general secretary of Nepal Agricultural Produce Potato, Onion Import Export and Wholesalers Association.

He said the Inland Revenue Department was harassing businesses by going to farms and telling them they had not registered on VAT and threatening them with action.

“This is discouraging us,” he said.

According to the Kalimati Fruits and Vegetables Market Development Board, traders nationwide have ceased the sale of potatoes and onions for nearly three days. Binay Shrestha, the Information Officer of the Board, stated that traders had stopped importing potatoes and onions, resulting in empty stalls for these commodities.

“Kalimati does not have potatoes and onions,” said Shrestha. “I don’t know the reason, but the traders have not brought potatoes and onions into the market.”

This has resulted in the price of potatoes and onions skyrocketing in Kathmandu.

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