Capital Gains Tax Collections Plunge 72% in Bhadra; Short-Term Traders Still Book Profits
Government revenue from capital gains tax fell 72% in Bhadra as NEPSE losses shrank investor profits. Short-term traders earned modest gains.
Nepal’s capital gains tax (CGT) revenue plunged in Bhadra, underscoring how last month’s market downturn eroded both government collections and investor profits.
According to Central Depository System and Clearing Ltd. (CDSC), the government collected only Rs 601.5 million in CGT during Bhadra, compared to Rs 2.15 billion in Shrawan, marking a steep 72.12% decline.
The fall mirrors a sharp contraction in investor earnings. Overall, investors booked Rs 9.19 billion in profits in Bhadra, down 71.38% from Shrawan’s Rs 32.12 billion.
Short-term traders, taxed at 7.5%, made Rs 4.38 billion, down 72.9%.
Long-term investors, taxed at 5%, earned Rs 4.16 billion, down 68%.
Institutional investors, taxed at 10%, booked just Rs 645 million, down 78%.
CGT payments followed a similar trend:
Short-term traders paid Rs 328.8 million, down from Rs 1.21 billion in Shrawan.
Long-term investors paid Rs 208.2 million, down from Rs 650 million.
Institutions paid Rs 64.5 million, down from Rs 293.2 million.
Analysts say the data highlights NEPSE’s heavy retail-driven nature. When markets tumble, small investors panic-sell and overall tax contributions collapse. Despite short-term traders managing to capture some profits, long-term and institutional earnings shrank dramatically.