Reforms in tax administration and new entrants in the tax net have encouraged successive finance ministers to set ambitious revenue targets.
This fiscal year also, Finance Minister Surendra Pandey set a target of Rs 176.50 billion revenue -- Rs 150.24 billion from tax revenue and Rs 26.25 billion from non-tax revenue. While he announced his accommodative budget of Rs 285.93 billion for the fiscal 2009-10 on July 13, he was under tremendous pressure from his predessesor Dr Baburam Bhattarai's success in collecting -- then dubbed ambitious by the opposition -- Rs 147.72 billion revenue. Though the finance ministry officials while preparing this fiscal year's budget initially suggested Pandey not to be too ambitious in setting the target, he could not resist himself.
Tradition also dictates that the finance minister set 10 per cent to 15 per cent higher revenue target each successive year.
The revenue section of the finance ministry has worked out a monthly target for the whole year. According to revenue secretary Krishnahari Baskota, it was necessary to achieve the overall target. For the first month of this fiscal year (July16-August 16), it had set a target of Rs 9.78 billion but the ministry exceeded the target and collected Rs 11.74 billion giving an indication of the coming days.
"The collection was Rs 4.02 billion more than that in last fiscal year's same month," Baskota said adding that during the first month of last fiscal year, the ministry had collected Rs 7.72 billion revenue. "The 52.2 per cent higher revenue collection in the first month in comparison to the corresponding month in the fiscal year 2008-09 shows that we can achieve the target easily," he added.
According to the ministry, among all taxes the Value Added Tax (VAT) will fetch in the most revenue, followed by customs. The ministry is set to collect Rs 51.56 billion in VAT and Rs 33.12 billion in customs. The collection from excise duty would be Rs 19.64 billion and that from education service tax Rs 120 million, according to the target. It has planned to collect Rs 26.25 billion in non-tax revenue.
The ministry has set Rs 25.67 billion -- the largest collection target -- for the last month of the fiscal year -- that is June16-July 16, 2010. The second largest collection it is eyeing during the sixth month of the fiscal year is Rs 20.10 billion. It is but natural that the sixth and the last month of the fiscal year are bigger revenue earners.
The ministry is also encouraged by the campaign to register for service sector employees and professional consultants in the permanent account number (PAN ) to boost revenue. It has started PAN registration for the individuals who have regular income. Through PAN registration the state aims to tighten its grip on professionals providing multiple consultancy services but who are getting away with only a 15 per cent tax contribution.
Monthly Revenue Target
July 16-August 16 – Rs 9.78 billion
August 16-September 16 – Rs 9.25 billion
September 16-October 16 – Rs 9.58 billion
October 16-November 16 – Rs 12.70 billion
November 16-December 16 – Rs 13.53 billion
December 16-January 16 – Rs 20.10 billion
January 16-February 16 – Rs 15.43 billion
February 16-March 16 – Rs 14.76 billion
March 16-April 16 – Rs 17.64 billion
April 16-May 16 – Rs 14.53 billion
May 16-June16 – Rs 13.47 billion
June 16-July16 – Rs 25.67 billion
Total – Rs 176.50 billion
No comments:
Post a Comment