Businesspersons involved in the potato and onion trade in Nepal are on strike in protest against the government's decision to impose value-added tax (VAT) on these vegetables, even those grown domestically. The government's move to apply VAT on both imported and domestically produced potatoes and onions has sparked concerns among traders, who fear it will lead to shortages in the market. The budget for the fiscal year 2023/24 originally mentioned imposing VAT on imported vegetables, but traders argue that the tax is now being applied to locally grown potatoes and onions as well.
Prakash Gajurel, the general secretary of Nepal Agricultural Produce Potato, Onion Import Export and Wholesalers Association, expressed frustration, stating that the Inland Revenue Department is harassing businesses by pressuring farms to register for VAT and threatening them with consequences. As a result of the protest, traders nationwide have ceased the sale of potatoes and onions for nearly three days, leading to empty stalls in markets.
The Kalimati Fruits and Vegetables Market Development Board reported that traders have halted the import of potatoes and onions, causing a shortage in these commodities. This shortage has resulted in a significant increase in the prices of potatoes and onions in Kathmandu.