Tax Collection Costs Rise to Rs 3.38 per Thousand Due to Missed Targets and Increased Fiscal Goals

In the fiscal year 2079/80, the government of Nepal incurred a cost of 3.38 paisa to collect 1000 rupees of internal revenue, as indicated by a government-conducted cost analysis. The Internal Revenue Department (IRD) reported a total revenue of Rs 4.79 kharba for the year, with departments and subordinate offices spending Rs 1.41 arba on current and capital. Consequently, the tax collection cost per thousand for the year stood at Rs 3.38, reflecting an increase from the previous year's 2.23 paisa. This rise is attributed to the department falling short of its revenue target in the preceding year, achieving only 76.58% of the set goal of Rs 6.26 Kharba.

The overall revenue collection growth rate for the year was negative by over 10%, primarily influenced by reduced imports and economic relaxation. The diminished revenue collection exerted pressure on the government's resource management, with the target for the year set at Rs 14.3 kharba but only Rs 10.10 kharba was collected, representing 72% of the total target.

The department emphasizes that technological advancements in the tax system have contributed to a recent decrease in the cost per thousand. Additionally, it asserts that administrative improvements, adherence to expenditure frugality standards, and increased taxpayer participation have all played roles in reducing costs.