Revenue collection up by 15.4 pc

Revenue collection up by 15.4 pc
eKantipur.com, 1-Oct-2007

The government's revenue collection maintained its growth trajectory and rose by 15.4 percent in the first two months of the current fiscal year, compared to the same period last year.

According to the Ministry of Finance (MoF), the government collected revenue amounting to Rs 12.41 billion during the period. The collection stands at about 12 percent of the target the government set for the year. The government is targeting to raise Rs 103.66 billion in revenue during the 2007/08 fiscal year.

An official at the MoF said that growing consumption and consequent rise in imports had pushed up the collection. "With the 11-year conflict ending, some sectors of the economy, like tourism, have begun to revive," he said. "However, the collection is still not encouraging because the situations of the industrial and export sectors have not improved yet."

He stated that frequent strikes, protests, and highway closures had hampered the government's efforts to tap the revenue potentiality. "Many industries have remained closed, while operations of others have remained disturbed at different intervals due to trade unions' protests," he said, elaborating on the reason behind the less than required volume of collection.

The government's total expenditure during the period amounted to Rs 8.87 billion, which is a rise of 10.6 percent compared to same period last year. Around Rs 891.8 million was spent under capital expenditure, which covers investment in development projects. This indicates that development activities have moved on at a snail's pace. The budget for the current fiscal year has allocated over Rs 55 billion under capital expenditure.

Normally, the development expenditure remains negligible in the initial months of the fiscal year, said officials. They, however, added the development process is reeling under the structural inflexibility in the spending system, poor absorptive capacity and multilayer as well as complicated decision-making channels. They expressed hope that the pace of spending will speed up after the first half of the fiscal year.

Of the allocated Rs 98 billion for regular expenditures, the government utilized Rs 7.54 billion during the period, says a MoF press release. Likewise, the government paid back Rs 439.8 million of debt stock.

The total spending recorded during the period was 58 percent of the total fund released. The central bank had released Rs 15.23 billion for the total spending during the period, which included Rs 12.93 billion as regular expenditure, Rs 1.69 billion as capital expenditure and Rs 599 million for repaying debts.