Prime Minister Balendra Shah on Tuesday announced the withdrawal of the government’s proposed three percent equity fee on private education and health services following public criticism over the measure.

In a social media post, Shah said the decision was made after consultations with Finance Minister Swarnim Wagle, acknowledging concerns that the levy would increase the financial burden on citizens.

“Implementing the three percent equity fee on private education and health sectors as proposed would result in additional costs and frustration for the general public. Therefore, following consultations with Finance Minister Swarnim Wagle, it has been decided not to enforce the education equity fee and health equity fee for the time being,” Shah wrote.

The prime minister said the move reflected the government’s commitment to remaining responsive to public concerns and acting in line with citizens’ expectations.

Shah said the proposed fee was introduced with the aim of improving education and healthcare services in remote and disadvantaged areas, supporting Dalit, marginalised and low-income children, expanding health insurance coverage and generating resources for such programmes while widening the tax base.

However, he said widespread opposition to the measure led the government to reconsider its implementation.

Shah also reiterated that the government would continue with its policy requiring private hospitals to reserve 10 percent of beds and private colleges and universities to allocate 10 percent of seats for disadvantaged citizens through a transparent and equitable process.

He said the policy was aimed at improving access to quality healthcare and education for communities that have historically faced barriers.