New Code of Ethics for Inland Revenue Department Officials: Approved by the Director General on 2082/12/25 (effective immediately);
Nepal’s Inland Revenue Department (IRD) has released a comprehensive Code of Ethics 2082 for all its officers and staff working in the Department and its subordinate tax offices. This is the first major update since the 2074 Code and marks a significant upgrade in governance standards for Nepal’s tax administration.
For accounting firms, taxpayers, and businesses, this document is excellent news. It sets clear, enforceable standards of conduct that directly translate into faster service, greater transparency, and reduced opportunities for harassment or corruption.
Core Values That Will Govern Every Tax Official
The Code explicitly requires every IRD employee to uphold the following principles:
- Integrity & Honesty – Strict adherence to the law without any twisting or selective application.
- Impartiality & Non-Discrimination – No favoritism based on political affiliation, caste, gender, religion, or personal connections.
- Transparency & Accountability – Decisions must be objective, fact-based, and documented.
- Professionalism & Service Orientation – Courteous, prompt, and helpful behavior toward all taxpayers.
- Duty Consciousness – Timely completion of assigned responsibilities without delay or negligence.
Key Conduct Rules That Directly Benefit Taxpayers
- Faster & Smoother Service Delivery Officials must provide services “quickly, easily, and effectively.” Unnecessary delays or “keeping files pending” are now explicitly prohibited.
- Zero Tolerance for Gifts, Favors & Hospitality Accepting any gift, donation, or hospitality from taxpayers or their representatives is strictly banned.
- Strict Confidentiality Taxpayer information must remain protected. Unauthorized disclosure is a serious breach.
- No Private Meetings or Side Deals Unauthorized meetings with taxpayers or acting as their representative/agent is prohibited.
- Proper Use of Digital Systems Greater emphasis on digital platforms, e-filing, and e-evidence. Officials are encouraged to maximize digital tools for quicker processing.
- Political Neutrality Officials cannot participate in political activities or allow political influence to affect their duties.
- Clear Dress Code & Identification Officials must wear the prescribed uniform/identification badge during office hours, making it easier for taxpayers to identify them.
- Prompt Reporting of Problems Any difficulty in performing duties must be immediately reported to superiors instead of passing the burden to taxpayers.
What Acts Are Now Explicitly Prohibited?
The Code lists specific actions that will be treated as violations, including:
- Delaying or harassing taxpayers
- Demanding or accepting bribes (directly or indirectly)
- Misusing official position or government property
- Sharing confidential taxpayer data
- Engaging in political activities
- Working for any private organization or taking other employment without permission
How This Helps Your Business
As an accounting firm serving hundreds of clients across Nepal, we see this Code as a powerful tool for compliance and peace of mind:
- Reduced Compliance Risk – Clear rules mean fewer arbitrary demands or “gray-area” interpretations.
- Faster Refunds & Approvals – Timeliness is now a formal duty.
- Stronger Recourse – If any official violates the Code, taxpayers now have a clear ethical framework to reference when escalating complaints.
- Improved Taxpayer Confidence – A professional and ethical tax administration encourages voluntary compliance and long-term trust.
Our Advice to Clients
While the Code raises the bar for tax officials, we recommend clients continue best practices:
- Always communicate through official channels (IRD portal, official email, or recorded letters).
- Keep complete documentation of every interaction.
- Report any unethical behavior promptly to the concerned office head or the Department’s monitoring mechanism.
- Leverage digital services wherever possible – the Code actively encourages this.
