Government revises revenue target upward

Encouraged by the whopping revenue collection trend, the government has revised its target upwards by Rs 13 billion to Rs 190 billion.

Earlier in the budget for the fiscal year 2009-10, the government had set a revenue target of Rs 176.5 billion for this fiscal year. "However, the revenue growth trend made us revise the target upward by over Rs 13 billion," said revenue secretary Krishnahari Baskota.

By the end of the ninth month (mid-April) this fiscal year, revenue collection surpassed the target by Rs 3.71 billion. "Our target for the ninth month was Rs 122.82 billion," he said, adding that the collection is 28.2 per cent higher than the corresponding period last year. "Last year by the end of ninth month, we had collected Rs 98.67 billion," Baskota said.

The encouraging collection by the end of ninth month is also due to the timing as its the time of paying installment of income tax to the government.

Apart from that, Nepal Telecom paid Rs 3.30 billion cash dividends to the government. The NT has approved 35 per cent cash dividends to its share holders. The cash dividends made government non-tax collection swell to Rs 16 billion, making it the fourth largest contributor to the government coffer.

The largest contributor for the coffer is still the value added tax (VAT) that has contributed Rs 39 billion to the government coffer in the ninth month of the current fiscal year. VAT is followed by the customs that has contributed Rs 25.10 billion and the third largest contributor is the income tax that has contributed Rs 23.25 billion.

By the end of eight month, Falgun (mid-March), the government had collected Rs 105.58 billion. By the end of seventh month of the current fiscal year Magh (mid-February), the collection stood at Rs 94.28 billion, surpassing its own target of Rs 90.41 billion.

Since past few years, the revenue collection has seen an increasing trend.

In the last fiscal year, the government had set a target of Rs 142 billion. However, by the end of the last fiscal year, the government had exceeded the target to collect Rs 145 billion.

The collection trend

First month (Shrawan) -- Rs 11.47 billion

Second month (Bhadra) -- Rs 22.55 billion

Third month (Ashwin) -- Rs 34.32 billion

Fourth month (Kartik) -- Rs 46.67 billion

Fifth month (Mangsir) -- Rs 58.60 billion

Sixth month (Poush) -- Rs 79.68 billion

Seventh month (Magh) -- Rs 94.28 billion

Eighth month (Falgun) -- Rs 105.58 billion

Ninth month (Chaitra) -- Rs 126.53 billion

Finance Minister positive, budget will pass

The government will run out of expenses in less than a month unless it can lift opposition United Communist Party of Nepal (Marxist) protests in parliament and pass the budget for the fiscal year 2009-10.
But finance minister Surendra Pandey is hopeful that the UCPNM will help pass the budget. "If they will not assist, their combatents in the UN-monitored camps -- along with civil servants and parliamentarians -- will also suffer," he said addressing media at the Reporters' Club in the Valley today.
The parliament must approve this fiscal year's budget by the middle of November or face a likely shutdown of the administration, with the government unable to pay employees. "We have already stopped the minister's salary," he said.
The UCPNM lawmakers have held up proceedings in the parliament for a couple of months with protests against the president for rejecting the dismissal of the army chief by their government. They have been asking for the correction of the President's move, which literally means the fall of incumbent Prime Minister Madhav Kumar Nepal-led government.
The decision by the President -- who officially commands the military -- led Maoist leader and then Prime Minister Pushpa Kamal Dahal 'Prachanda' to resign. A present coalition government took over in May.
President Dr Ram Baran Yadav had overruled Dahal's attempts to fire the then army chief, saying they were unconstitutional.
If the budget could not be passed, the government has to bring ordinance. "But there is no need to go through ordinance," Pandey said suggesting the UCPNM to go to street "but not to obstruct parliament and let the budget pass."
He claimed that budget and Civil Supremacy is different issue. "Reinstatement of chief of army staff by president and budget is completely a different issue," he tried to convince the former guerrillas. "Budget is an issue of public concern," he added.
Delay in passing the budget has creating problems, he said adding that ministers pay has already been stopped.
Due to delay in passing the budget, government has been facing problems in development expenditure, he said adding that the trend will encourage spending of development budget at the end of fiscal year that should not happen.

What's in Constitution?
KATHMANDU: according to the Interim Constitution of Nepal, Article 96 Votes on Account:
(1) Notwithstanding anything contained in this Part, a portion of the expenditure estimated for the financial year may, when an Appropriation Bill is under consideration, be incurred in advance by an Act.
(2) A Vote on Account Bill shall not be submitted until the estimates of revenues and expenditures have been presented in accordance with the provisions of Article 92 and the sums involved in the Vote on Account shall not exceed one-third of the estimate of expenditure for the financial year.
(3) The expenditure incurred in accordance with the Vote on Account Act shall be included in the Appropriation Bill.

Mega Cities planned
KATHMANDU: Finance Minister Surendra Pandey said that government is planning three mega cities. But he didnot elaborate. He also informed that government is promoting developing activities in seven priority sectors. "The government is bringing policies for maximum land utilisation, increasing self-reliance on agriculture, tourism promotion and using forestry for economic benefit," he detailed. Revenue collection has been satisfactory so far, he said adding that the government is raking more revenue in comparison to last year.

Record revenue collection but government fails to spend Rs 25 billion for development works

The Finance Ministry has managed to collect record revenue during the month of Chaitra (mid-March to mid-April), exceeding its target.
The ministry collected 39.3 per cent higher revenue at Rs 98.67 billion as per year-on-year record. When Finance Minister Dr Baburam Bhattarai tabled his maiden budget on September 19 last year, the revenue target of Rs 147.72 billion was billed ambitious. The budget for the current fiscal stands at Rs 236.15 billion. “The collection has touched Rs 98.67 billion in only nine months. It has exceeded the target, which was pegged at Rs 93 billion,” said Krishna Hari Baskota, acting revenue secretary. He attributed the “good show” to able leadership, growing control over corruption and a cordial relationship between the Maoist-led government and private sector. “The private sector has been supportive. While, the record collection suggests that the environment is business friendly,” he added.
Earlier in Falgun, the ministry mopped up 38.6 per cent of revenue.Despite the impressive collection, the ruling coalition has failed to utilise the sum for development work, which in turn has taken its toll on the GDP growth. “Consequently, the income generation will be hit hard, leading to spiralling unemployment,” explained Dr Shanker Sharma, former vice-president, National Planning Commission (NPC).
The Finance Minister has affirmed of giving top priority to more employment opportunities in the next budget.
“But if the government goes on a spending spree in the last quarter of this fiscal, then it may encourage inefficiency,” he added. Though the treasury has Rs 25 billion, it is lying idle for months.