Veteran Investor Chhotelal Rauniyar Proposes 15-Point Reform Agenda for Nepal’s Capital Market

Former Chairman of the Nepal Investors Forum and veteran investor Chhotelal Rauniyar has submitted a 15-point set of recommendations to the Securities Board of Nepal (SEBON) aimed at strengthening Nepal’s capital market and protecting investors’ interests. Rauniyar presented the proposals to SEBON Chairman Dr. Gopal Prasad Bhatt during a meeting, emphasizing the need for long-term policy reforms to improve market confidence and liquidity. One of his key proposals is to reduce capital gains tax from the current 5% to 4% for long-term investors holding shares for more than one year, and from 7.5% to 6.5% for short-term investors. He argued that lower tax rates could encourage market activity, potentially raising daily turnover to Rs. 15–20 billion while also increasing government revenue. Among his other recommendations, Rauniyar has called for removing the six-month restriction on banks and financial institutions trading shares in the secondary market, restructuring fees charged by SEBON, NEPSE, CDSC and brokers, and replacing the dual commission system with a single-sided commission. He has also proposed introducing futures and options, intraday trading, short selling and ETFs alongside adequate safeguards for small and retail investors. Other recommendations include eliminating the additional 5% tax on bonuses and cash dividends after corporate tax has already been paid, completing annual general meetings within two months of the fiscal year-end and distributing dividends within the following month, and removing the requirement for annual renewal of Demat accounts. Rauniyar has further urged SEBON to eliminate unnecessary restrictions on bonus shares and cash dividends when shares are already pledged under 70% margin lending, upgrade the existing TMS system to international standards, and establish convenient payment gateways for NRNs and foreign direct investment. He also called for the modernization and conversion of NEPSE into a public company, continuation of the 10-unit IPO allotment policy, and removal of legal barriers preventing non-resident Nepalis from investing and repatriating profits. He has also sought greater autonomy and authority for SEBON to transform it into a modern capital-market regulator, along with dedicated monitoring units at SEBON and NEPSE to curb market rumors, manipulation and cyber-related offenses. Rauniyar expressed confidence that implementing these reforms would strengthen investor confidence, improve capital mobilization and help Nepal’s stock market reach new heights.