KATHMANDU - Finance Minister Dr. Baburam Bhattarai on Thursday called on private educational institutions to comply with the government decision to impose a five percent education tax, saying that the private sector also has a responsibility to help build a new Nepal.

Bhattarai, whose announcement of the education tax has drawn flak from the private sector and student leaders, said the tax would be compulsory for the private educational sector.

The government in this year's budget imposed an additional tax on private sector education to help ensure education for highly marginalised and Dalit children in the Karnali region.

"I, on behalf of the government, request educational institutions to comply with the new regulation brought in with good intentions, as they too have a responsibility to help build a new Nepal," said Bhattarai. He was speaking at an interaction in the capital.

Bhattarai said the tax would be paid not by parents and students, but by educational institutions from their profits. "The operators of educational institutions have a responsibility to pay the tax from their profits. The money collected will be utilised for the welfare of children in remote areas" said Bhattarai.

The government, according to him, is going to conduct a study into the implementation of the education service tax. A study team has been set up with joint participation of the private sector and the Ministries of Education and Finance. Bhattarai said the new regulation would be implemented soon after the team submits its study report.

The finance minister also disclosed that the government would change the 'two types of education' - public and private -- into one in the long run.

The government is also trying to allocate an additional budget for education as the existing budget is not sufficient, he added.

Umesh Shrestha, president of Higher Secondary School Association of Nepal, said the private sector was ready to go along with the government. However, Shrestha added that the government decision to impose an additional tax would create hassles for 60 percent of private schools.

A case has been filed at the Supreme Court against the government decision to impose the five percent tax.

Source: nepal1st.com/modules.php?name=News&file=article&sid=1533