Only five percent tax on retirement money of govt employees

KATHMANDU:- The Supreme Court has issued an order that only five percent tax could be imposed on the money and incentives the government employees get in the retirement. The full text of the verdict was released on Wednesday.

Earlier, two months back, a division bench of Justices Ishwor Khatiwada and Nahakul Subedi had issued the verdict to this regard.

Before the verdict, the government was imposing 15 percent tax on the money and incentives government employees were entitled in the retirement as per Income Tax, 2058. The employees of the Rastriya Banijya Bank had filed a case against provision of 15 percent tax.

With the verdict, the Section 65 of Income Tax Act, 2058 is cancelled and Section 88 (1 proviso) of the Act is implemented for the 5 percent tax.