Revenue collection soars, but budget spending meagre

 Kathmandu, Aug. 22

The government has collected about Rs. 100.5 billion revenue in the first five weeks of the current Fiscal Year 2021/22. The collection is 8.74 per cent of the total annual target of Rs. 1151.6 billion as estimated in the budget of current fiscal, according to the Daily Budgetary Report of the Financial Comptroller General Office (FCGO).

Likewise, total government receipts during the first five weeks of the FY amount to Rs. 113.6 billion – about 9.35 per cent of the annual target of Rs. 1214.9 billion.

This is a significant increase compared to the collections in the last fiscal 2019/2020 when the government could raise only 6.4 per cent revenue of the total target of Rs. 1011.7 billion while the total government receipts stood at 6.81 per cent.

If this trend continues till the end of the year and there are no obstructions and restrictions to the economic activities, the revenue target will be met easily. In addition to this, revenue collection increased during the last quarter of the fiscal.

However, although revenue collection was up the mark compared to the previous year, there is no reason to have larger hopes since the money raised in the first month of the fiscal year is also from the cash returns to the state coffers.

"Budget that various agencies could not utilize in the last fiscal year 2019/20 is surrendered to the capital fund of the government. This year, a significant amount of conditional and matching grant is returned from the budget of the last fiscal," said Spokesperson of the FCGO, Gyanendra Poudel.

According to him, the outstanding trend of revenue collection would not be continued in the current and coming months.

FCGO statistics show that in the first five weeks, Rs. 83.3 billion tax revenue and Rs. 17 billion non-tax revenue is collected which make 8.03 per cent and 15.22 per cent of their annual targets respectively.

The government aims to raise Rs. 1038.1 billion tax and Rs. 113.4 billion non-tax revenue in the current FY.

While the revenue collection soared, budget mobilisation has remained pathetic in the first five weeks of the current fiscal.

Despite limited restrictions on a few service businesses including travel, tourism, entertainment and education, budget execution couldn't take momentum and only 1.11 per cent of the Rs. 1647.5 billion is spent so far. Capital spending stands at only 0.25 per cent of Rs. 435.2 billion.

A Finance Ministry source said that the lack of leadership at various development ministries has hampered budget spending.

Last year, amidst the raging coronavirus and limited opening of business and economy, about 0.17 per cent budget was mobilised where only 0.13 per cent development budget was spent.

Published in The Rising Nepal daily on 23 August 2021.