Worldlink cleared of Rs 294.37 crore tax evasion allegations

KATHMANDU: Nepal’s top internet service provider, Worldlink Communications Limited, has been cleared of allegations of tax evasion totaling nearly Rs 294.37 crore.

The Office of the Attorney General (OAG) upheld earlier decisions by the District Government Attorney’s Office in Lalitpur and the High Government Attorney’s Office in Patan, confirming that no legal action will be taken against the company.

The Revenue Investigation Department had accused Worldlink of collecting additional funds under the guise of maintenance fees and failing to pay the Telecommunications Service Charge (TSC) between fiscal years 2077/78 and 2081/82, claiming this amounted to a revenue leak of Rs 294.37 crore.

However, the Attorney General’s office found that Worldlink had levied fees within the legally approved limits and paid the applicable taxes.

While the law imposes a 10% TSC on telecommunications revenue, fixed broadband providers are allowed to charge up to 50% as maintenance fees without TSC.

Evidence showed that Worldlink operated its internet packages according to rates approved by the Nepal Telecommunications Authority, issuing bills accordingly.

For instance, on a Rs 950 monthly plan, Rs 450 was charged for internet service and Rs 450 as maintenance fees, with TSC applied only to the internet portion.

The decision also noted that other service providers followed similar practices, and Worldlink could not be singled out.

The company often charged less than the approved maintenance fee, which cannot be classified as tax evasion.

Regarding other income tax evasion allegations, the OAG said ongoing tax audits should continue, and immediate criminal proceedings would be inappropriate. Under Nepal’s self-assessment tax system, taxes can be revised within four years.

The final decision clears Worldlink executives, including Dilip Agrawal, Manoj Agrawal, Keshav Nepal, Sunil Yadav, Laxmankumar Yadav, Vaishnavi Narayanan, and Volker Klein, of all charges.

Attorney General Sabita Bhandari certified the decision, concluding that Worldlink has operated fully within the legal framework.

Worldlink responded that the verdict removes uncertainty over internet fees and TSC, protects consumers from extra financial burden, and supports the sustainability of Nepal’s internet industry.

The company emphasized that this ruling is crucial in ensuring affordable and accessible internet for all.