The Nepal LP Gas Industry Association has expressed readiness to merge gas industries but has urged the government to ensure that Sections 57 and 59(A) of the Income Tax Act, 2058, do not apply to such mergers.
The association made the proposal after Nepal Oil Corporation (NOC) included a merger policy in its approved programme for fiscal year 2083/84 to streamline LPG distribution and protect consumer interests. NOC has also asked the association to encourage mergers and prepare an implementation plan.
Section 57 of the Income Tax Act treats a company as a new entity if its ownership changes by more than 50 percent, potentially triggering capital gains and other tax liabilities. The association has requested NOC to facilitate an exemption from these provisions.
