Pokhara, 30 January | The Federation of Nepalese Chambers of Commerce and Industry (FNCCI) Gandaki Province has formally demanded the immediate withdrawal of the recently introduced environment management fee, arguing that the provision is both unconstitutional and an excessive financial burden on the industrial sector. On Thursday, a delegation from the federation submitted a memorandum to Gandaki Province Chief Minister Surendra Raj Pandey in Pokhara, contending that the fee published in the provincial gazette violates the constitutional framework and threatens the investment-friendly environment in the province. The business community has warned that such unilateral taxation could lead to the displacement of investment and cripple domestic industries.
According to the memorandum, the FNCCI Gandaki claims that Section 9 of the ‘Act No. 06, Volume 8, Supplement 05 of the Year 2082,’ passed by the Gandaki Provincial Assembly, contradicts Article 203 of the Constitution of Nepal. This constitutional article explicitly states that no tax shall be levied or collected in a province except in accordance with the law. The federation pointed out that neither the exclusive provincial power list nor the concurrent power list between the federation and the province, as outlined in Schedule 6 of the Constitution, includes the authority to collect an ‘environment management fee.’ Therefore, they argue that the provincial government has overstepped its jurisdiction, rendering the provision void as per Article 2, Sub-article 1 of the Constitution, which stipulates that any law inconsistent with the constitution is invalid to the extent of such inconsistency.
Industry leaders emphasized that they are already strictly adhering to the Environment Protection Act and regulations of the federal government, submitting regular environmental impact reports to the Department of Environment. Furthermore, they highlighted their contributions to environmental conservation through corporate social responsibility initiatives such as tree plantation and waste management. The federation expressed deep concern that imposing an additional fee without any prior consultation with stakeholders is unfair, especially when domestic industries are already struggling with high raw material taxes and expensive logistics costs. They noted with dissatisfaction that the new fee remains silent on pollution caused by imported goods while discouraging local production. FNCCI Gandaki warned that if this provision is not revoked, it will not only hurt industrial growth but also lead to an increase in consumer prices, as other provinces might follow this negative precedent, ultimately impacting the national economy.
