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Revenue collection target missed by Rs 25bn

July 18, 2019

The Himalayan Times, July 18, 2019

The government missed its revenue collection target in 2018-19 fiscal.

Initially, the government had set revenue collection target at Rs 945 billion in the 2018-19 fiscal, which ended on Tuesday. The Ministry of Finance (MoF) had later revised down the collection target to Rs 860 billion.

However, the government has even missed the revised target by almost Rs 25 billion, as per the Financial Comptroller General Office (FCGO).

As per FCGO’s data, the government was able to collect Rs 835 billion in revenue in the last fiscal.

The FCGO data show that collection fell short of the set target in excise duty, customs and VAT, thereby hitting the overall revenue collection during the year.

The MoF had set target to collect Rs 209.7 billion in revenue from income tax in 2018-19 while income tax collection was limited to Rs 190 billion only, as per FCGO. Similarly, the government was able to collect almost Rs 155 billion in customs duty against the set target of Rs 164 billion.

The government also missed the VAT collection target by Rs 10 billion.

Though the government had targeted to collect VAT worth Rs 250 billion in 2018-19, VAT collection was limited to Rs 240 billion during the year.

Likewise, the government also missed the excise duty collection target in the last fiscal year. Though the government had set the target to collect Rs 124.88 billion from excise duty in 2018-19, it was able to collect only Rs 121.5 billion under the heading during the year.

As per sources at MoF, low capital expenditure during 2018-19 primarily affected the overall revenue collection of the government, while different pending tax issues at the court worth billions of rupee also dented the collection.

However, experts opined that the initial revenue collection target was itself ambitious, which is why the government missed the set target.

“The initial revenue collection target of Rs 945 billion in 2018-19 was ambitious as it was almost 30 per cent more than the previous year’s target.

The government should have hiked the revenue collection target by maximum of 15 per cent than the target of the previous fiscal year,” said Bishwo Poudel, an economist.

Source: https://thehimalayantimes.com/business/revenue-collection-target-missed-by-rs-25bn/