Administration fails in revenue mobilisation
KATHMANDU:
Though the country could not meet revenue target for the current fiscal year, last five year’s revenue policy has been successful, claimed revenue authority.
Finance Ministry had initiated reform in revenue policy like structure of tax-administration, tax system, use of technology and human resource under its five-fold reform strategy in the revenue sector five year’s ago,” according to director general at the Department of Revenue Investigation Shanta Bahadur Shrestha.
At a time when most of the economic indicators were negative only revenue mobilisation had been able to meet its target all these years, he said, adding that the government has also succeeded to formalise some part of the economy that was not in the formal channel earlier due to positive aspects in the revenue administration like technology enhancement in tax administration. “Around 65 per cent taxpayers pay tax online at present,” he said, adding that the country is going through structural reform on tax policies like widening tax base instead of raising tax rates.
Representation of private sector in Revenue Advisory Committee has helped incorporate their demand in the tax policy,” Shrestha said.
With all the positive achievements, experts however said that the government has failed to create an independent revenue authority which is out of political influence and bias.
“Even though revenue administration is competent, it is sometimes being paralysed due to political interference and greed,” a source at the ministry said.
The government has failed to form Revenue Board though it was promised in the budget for current fiscal year 2010-11. Similarly, Dr Ram Sharan Mahat had also promised to form High Level Tax Arrears Settlement Commission in the budget statement in the fiscal year 2006-07 and that could also not be realised.
The formation of independent Revenue Authority will make the revenue administration more competent, according to finance ministry officials. “Currently, revenue administration is compelled to continue the job of all civil servants, even if they are not competent,” he said, adding that the independent revenue board can take ‘hire and fire’ policy to make the board more competent.
However, the concept of formation of High Level Tax Arrears Settlement Commission is not relevant yet, according to the source. It is not the theory of justice to provide same facilities to on-time taxpayers and those who pay late, he said.
The finance ministry failed to achieve its revenue mobilisation target for this fiscal year due to political reasons,” the ministry source said, adding that delay in budget and subsequently delay in revising customs valuation and other goods hurt the government coffer. “Smuggling and other tax fraud under political protection has also played key role for shortfall in revenue collection.
The rate card
Failure
• Central Revenue Board
• Revenue mobilisation target that is Rs 216 billion failed to meet as the new estimate is Rs 206 billion.
• Strict monitoring of market and control of illegal trade.
Success
• Formation of Money Laundering Investigation Department.
• Tax administration into electronic system.
• Implementation of Aumated System of Customs Data.
Source: THT
Though the country could not meet revenue target for the current fiscal year, last five year’s revenue policy has been successful, claimed revenue authority.
Finance Ministry had initiated reform in revenue policy like structure of tax-administration, tax system, use of technology and human resource under its five-fold reform strategy in the revenue sector five year’s ago,” according to director general at the Department of Revenue Investigation Shanta Bahadur Shrestha.
At a time when most of the economic indicators were negative only revenue mobilisation had been able to meet its target all these years, he said, adding that the government has also succeeded to formalise some part of the economy that was not in the formal channel earlier due to positive aspects in the revenue administration like technology enhancement in tax administration. “Around 65 per cent taxpayers pay tax online at present,” he said, adding that the country is going through structural reform on tax policies like widening tax base instead of raising tax rates.
Representation of private sector in Revenue Advisory Committee has helped incorporate their demand in the tax policy,” Shrestha said.
With all the positive achievements, experts however said that the government has failed to create an independent revenue authority which is out of political influence and bias.
“Even though revenue administration is competent, it is sometimes being paralysed due to political interference and greed,” a source at the ministry said.
The government has failed to form Revenue Board though it was promised in the budget for current fiscal year 2010-11. Similarly, Dr Ram Sharan Mahat had also promised to form High Level Tax Arrears Settlement Commission in the budget statement in the fiscal year 2006-07 and that could also not be realised.
The formation of independent Revenue Authority will make the revenue administration more competent, according to finance ministry officials. “Currently, revenue administration is compelled to continue the job of all civil servants, even if they are not competent,” he said, adding that the independent revenue board can take ‘hire and fire’ policy to make the board more competent.
However, the concept of formation of High Level Tax Arrears Settlement Commission is not relevant yet, according to the source. It is not the theory of justice to provide same facilities to on-time taxpayers and those who pay late, he said.
The finance ministry failed to achieve its revenue mobilisation target for this fiscal year due to political reasons,” the ministry source said, adding that delay in budget and subsequently delay in revising customs valuation and other goods hurt the government coffer. “Smuggling and other tax fraud under political protection has also played key role for shortfall in revenue collection.
The rate card
Failure
• Central Revenue Board
• Revenue mobilisation target that is Rs 216 billion failed to meet as the new estimate is Rs 206 billion.
• Strict monitoring of market and control of illegal trade.
Success
• Formation of Money Laundering Investigation Department.
• Tax administration into electronic system.
• Implementation of Aumated System of Customs Data.
Source: THT
