Focusing solely on the middle class and high-income groups will inevitably lead to increased inequality
Summary
The new Nepalese budget shifts focus towards expanding the middle class and IT sector, with tax cuts for high earners, raising concerns over increased inequality and insufficient poverty alleviation.
Key Points
- The Rastriya Swatantra Party government’s budget shifts focus from poverty alleviation to expanding the middle class and information technology sector.
- The budget lowers top income tax rates but increases consumption taxes, which are regressive and may increase inequality.
- Large infrastructure projects face delayed timelines and questionable prioritization, risking economic growth targets.
- Economic experts criticize the budget for neglecting direct poverty interventions and risking fiscal gaps due to optimistic revenue projections.
