A tea auction centre built by the government a year ago in Jhapa has yet to come into operation.

Tea industrialists’ demand the government raise the VAT waiver to 65 percent from existing 50 percent and offer a 5 percent VAT waiver on sales to domestic and foreign buyers is said to have hindered the operations of the auction centre.

The Ministry of Finance has asked the industrialists to file their demand in written form, according to sources at the Tea and Coffee Develop-ment Board. “The problem is because of the ministry’s inability to take decision,” said Indra Prasad Adhikari, area head of the board. “However, there are positive signs of initiation of operations from April 27, 2016.”

Led by industrialist Suresh Mittal, the board has formed an “auction committee” to start operations of the centre, set prices and to monitor quality of products offered.

Adhikari said the auction centre would attract buyers from India and other countries and increase competition in quality and pricing. “The auction centre would benefit the government, ensuring tax transparency.”

According to the government, the auction centre will be operated with an aim to give a brand identity to Nepali tea. 

The board has forwarded a Rs50-million investment proposal to government. The auction centre will house infrastructures like warehouse, testing room and auction hall. 

Tea expert Prithvi Bikram Rai said the auction centre would set international brand recognition of Nepali tea. 

“Till this date, Nepali tea is without brand in the international market, but establishing an auction centre is sure to resolve the issue,” he said. 

According to the board, tea is cultivated on 18,149 hectares of land in the Eastern Region.