Cooperatives Act 2074

Chapter 13 Exemptions, Facilities and Discounts

Section 78: Exemptions, Facilities and Discounts
1) Notwithstanding anything contained in the prevailing Nepal laws, a Cooperative Organisation shall be entitled to the following exemptions, facilities and discounts:
(a) No Cooperative Organisation shall be required to register any deed other than the deed relating to immovable assets,
(b) No income stamp ticket fees or registration fees shall be charged to the Cooperative Organisation while it procures necessary land or other immovable assets for its office building or service centre construction.
Provided that –
1) An Income stamp fee and registration fee shall be charged according to the prevailing laws when procuring other immovable assets, including land, for commercial purposes.
2) In case the immovable assets, including land procured with the registration fees exemption, are not used and are sold, the registration fee so exempted shall be repaid.
(c) No fee shall be charged while a Cooperative Organisation lends credits or while endorsing the deed of pledge.
2) Notwithstanding anything contained in the prevailing laws, no income tax shall be levied on the amount allocated for the reserve fund pursuant to clause (a) of sub-Section (2) of Section 68 by a Cooperative Organization, the amount de[1]posited in the secured capital redemption fund pursuant to sub-Section (2) of Section 69 and the amount deposited in the cooperatives promotion fund pursuant to sub-Section (2) of Section 70.
Provided that it shall be according to the laws on the tax liabilities of members who receive an amount from the secured capital redemption fund.
3) The Government of Nepal may, by notification in the Nepal Gazette, grant exemption according to the prevailing laws on the customs duty or value-added tax levied on machinery, industrial and agricultural inputs, equipment, spare parts, raw materials, and means of transport imported by a Cooperative Organisation for its purpose.
4) The Government of Nepal may, after publishing a notification in the Nepal Gazette, grant whole or partial exemption according to the prevailing laws on the excise duty or value-added tax levied on goods produced by a Cooperative organisation for its purpose.
5) The Government of Nepal may, having published a notification in the Nepal Gazette, grant exemption according to the prevailing laws on the export tax on the goods produced by a Cooperative Organisation and may provide a cash grant for export as is given to an industry according to the prevailing laws.
6) In addition to the exemptions referred to in this Section, the Cooperative Organization carrying out industrial enterprises shall be provided with the exemption, facilities and protection according to the prevailing laws which an industry is being provided with and the Cooperative Organization carrying out construction and operation of infrastructure structures, or carrying out special industries, enterprises, or services shall be provided with those facilities as are being provided to such industry, enterprise and service.
7) Government of Nepal, Provincial Government or Local Level may grant partial or full exemption in any type of tax to be imposed according to the prevailing law or make available special financial facilities or technical support, for promotion of cooperative farming by deprived rural women, persons with disability, freed kamaiyas, freed haliyas, landless farmers, unemployed labourers, Dalits and minority communities of marginalised groups or self-employment enterprises based on labour or skills of members.
8) In case labourers desires to bring into cooperative any sick public or private industry and to operate it again on their ownership, Government of Nepal may, considering the nature of the industry, provide grant for seed capital, loan or transfer of the ownership with discounted loan or provide tax exemption in trans[1]fer of private ownership, or provide guarantee or other appropriate assistance.
9) Government of Nepal may, by a notification in the Nepal gazette, provide the facilities of whole or partial exemption of the excise duty or value added tax to be levied on the share participation, infrastructure development, land or land acquisition, payment of compensation for land acquired and production of goods by large scale commercial projects of cooperative industrial village, marketplace development and so on which operate in special federal form.
10) The procedures for the acquisition of exemption, facilities and discounts under this Section shall be as prescribed.