Government fails to meet VAT‚ customs duty revenue target

KATHMANDU:

The government has failed to meet key revenue targets in the first month of the current fiscal year, with collection of value added tax (VAT), customs duties and excise duties falling behind the state’s expectation.

In between mid-July and mid-August this fiscal, the government was able to collect Rs 9.29 billion in VAT, which is 3.5 per cent short of the target set by the government. “The target could not be met due to a fall in VAT collection from goods produced in the country,” a statement issued by the Finance Ministry on

Tuesday states. Despite this, VAT collection went up by 17.03 per cent in the review period when compared to figures of the same period last fiscal.

The government also failed to meet the customs duty collection target this fiscal. The government collected Rs 4.68 billion in customs duties in the period between mid-July and mid-August, which was lower than the target of Rs 5.03 billion.

“Collection of customs duty fell below expectation because of slackness seen in imports,” the Finance Ministry statement says. In spite of this, customs duties mobilisation shot up by 17.73 per cent this fiscal than in the same period last fiscal.

Likewise, collection of excise duties also fell short of the target this fiscal, with mobilisation of Rs 2.99 billion — eight per cent less than expected. The government failed to meet the excise duty collection target due to slackness in collection of duties from imported goods, the statement says.

Although weakness was seen in revenue collection this fiscal, the government was able to beat its overall revenue target by Rs 1.39 billion due to higher collection of income tax, registration fees and other taxes.

The government collected Rs 4.03 billion in income tax this fiscal, which was Rs 727.39 million higher than the target and 29.22 per cent more than the amount collected in the same period last fiscal. The government also collected Rs 2.25 billion from registration fees and other taxes in the first month of this fiscal and Rs 725.45 million as non-tax revenue.

With mobilisation of these amounts, the government’s revenue collection stood at Rs 24.68 billion in the first month of the current fiscal, up 28.88 per cent than in same period last fiscal.

Source: THT