Laxmi Capital News
Revenue target met, but capital expenditure very low

The government has met the target of revenuecollection but spending in development projects remains very low. 

A total of Rs 336 billion were collected inrevenue in the first six months of the fiscal year, according to dailybudgetary status till Sunday, the last day of the first half of the fiscalyear. 

Until the first five months, revenue collectionhad been dwindling below the monthly target.

The amount is only a little over the target of Rs334 billion and the achievement is mainly due to the government’s surveillanceon collecting non-tax revenues, which includes land registration and vehicleregistration among others. 

The collection of non-tax revenues has posted agrowth of 150 percent, to Rs 39 billion against the target of Rs 26 billion, inthis period. 

The government has targeted to collect a total ofRs 730 billion in revenue for the budget of Rs 1278 billion for the currentfiscal year. 

With the slowdown in revenue collection, taxofficials had stepped up market monitoring. They collected about Rs 5 billionfrom undistributed amount from the registration fee of land transfer to achievethe target of revenue collection.  Revenue Secretary Shishir Dhunganaattributed this achievement of non-tax revenue to the dedication of civilservants and coordination between ministries. 

“But the tax revenue still remains below thetarget, only Rs 296 out of targeted Rs 307 billion,” Dhungana added. 

He said that they have collected additionaladvance taxes to meet the target. The government has not yet collected cashdividend of Rs 7.54 billion from Nepal Telecom as 55 percent dividend of itsinvestment, and this will come in the treasury in the seventh month, accordingto Dhungana.

In comparison to the corresponding period of lastfiscal year, the half-yearly collection of tax revenue and the non-tax revenuehave posted growths of 116 and 115 percent, respectively. 

Like in the past years, spending of the capitalbudget was only Rs 14.45 percent out of total allocation of Rs 335 billion.“This spending is an improvement from the same period of the last fiscal yearbut it is lower than the expected 20 percent,” said Arjun Prasad Pokharel,spokesperson for the Ministry of Finance. “This spending does not cover alldevelopment spending as fiscal transfer of Rs 150 billion given to local levelsis not reported in capital expenditure. It means none of such spending comes inthe count of capital spending of the government,” added Pokharel. Governmentofficials say that at least the local levels should have spent minimum 8percent of the allocated amounts and this may have increased the capitalspending. 

“And both last phase of local level elections andtwin elections of federal and provincial parliaments affected development worksin the beginning of the fiscal year,” argued Pokhrel, adding that the tenderprocesses have recently expedited indicating the spending will slowly takepace.

Source: My Republica,17th January 2018

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