Decline in import hits vehicle tax collection target

KATHMANDU:

The government is unlikely to meet its vehicle tax collection target in the current fiscal year due to decline in import of vehicles.

The Department of Transport Management’s report reveals it collected Rs 4.02 billion vehicle tax, which is 87.4 per cent of the target fixed for the first nine months of this fiscal year.

Based on the target, the department was supposed to collect Rs 4.6 billion by the end of the first nine months and Rs 5.5 billion vehicle tax by the end of this fiscal.

The slowdown in import and registration of automobile products is attributed to be the major factor behind the low progress in tax collection, according to the department officials.

The department registered a total of 145,254 units of vehicles in the review period this year, which is a decline by nearly 10 per

cent compared to the same period last fiscal. During the first nine months of last fiscal, it had registered 161,027 units of vehicles and collected four per cent more taxes than the target.

This year, there has been a fall in registration of other vehicles except cars, vans and power trailers, as per the department report. “When there is less import, vehicle tax collection also decreases,” said Mukti KC, technical director of the department. He added that they collected Rs 4.32 billion by the first 10 months and they are struggling to meet the target of Rs 5.5 billion.

In the review period, the transport department which also collects revenue under other tax heads collected a total of Rs 6.7 billion in taxes. It collected Rs 562.57 million under the heading of vehicle permission and driving licence issuance fee and Rs 1.93 billion as urban road construction and maintenance fee.

Likewise, Rs 184.04 million and Rs 2.68 billion have been collected under transport sector income and non-tax revenue headings, respectively. The department officials said that even as there was comparative growth in collection of other taxes,

revenue collection as fee from issuance of driving licence this year had declined due to the delay in implementing the new trial system in regional offices of the department. The department had collected Rs 693.36 million in revenue as licence issuance fee in the first nine months of last fiscal year.

Source: THT