Minister Mahat asks revenue officials to work proactively

 Kathmandu, July 5

Finance Minister Dr. Prakash Sharan Mahat has instructed the employees of the Inland Revenue Department (IRD) to be responsible and dutiful in collecting revenue in order to meet the revenue targets for the current Fiscal Year 2022/23 as well as the upcoming year.

The government is facing a hard time to meet its annual target of revenue collection. It could collect only 62.48 per cent, Rs. 913 billion, revenue (tax, non-tax and grants) of the annual estimates of Rs. 1458.6 billion by Tuesday evening.

Of Rs. 1403.1 billion tax and non-tax revenue, only Rs. 868.4 billion could be mobilised so far while the total expenditure by Tuesday stands at Rs. 1275.7 billion.  There is a wide gap of Rs. 364 billion between income and expenses.

FM Dr. Mahat asked the IRD officials to be congenial with the service seekers, not to look for personal benefits and said that no one is exempted from their duties and all should work dutifully in whatever responsibility they have.

"There should be no compromise on the tax that should be received by the state at the cost of personal benefits," he said.

According to him, the biggest task of the Ministry of Finance is to raise resources, and they are responsible for raising resources to address all the needs of the country.

"The biggest part of it is revenue. Now the share of the revenue is not enough to address the present development need. There is a need for increasing the revenue," said FM Dr. Mahat while adding, "We want the revenue to contribute to our salaries, allowances, social security payments and capital expenditure needs. However, we are not able to complete it."

According to the finance minister, it is not enough to increase the scope of revenue, the economy has to be accelerated, and for that, the government has talked about making the capital expenditure sustainable through the budget proposal.

He claimed that the point-by-point clear proposals have been made in his budget speech, and maintained that they have to pay serious attention to collecting customs duties and internal revenues.

Dr. Mahat stated that the country cannot always depend on revenue based on customs duties. "Internal loans and foreign loans should be invested in productive sectors. It has already been started. In the coming days, the internal revenue has a very big responsibility. So, there are concerns about how to expand it. The role of the IRD is important in this regard," he said.

Likewise, he stated two alternatives to increase the scope of revenue through IRD: making economic dynamic and bringing those who are evading taxes into the tax net.

Dr. Mahat said that the government has proposed many new taxes through the budget of the next Fiscal Year 2023/24.

According to him, the Value Added Tax (VAT) should be taken seriously. "It is a serious matter that the amount paid by the service recipient to the state is misused. Businessmen collect VAT during sales, and it should be filed unconditionally to the revenue. Any misuse or non-filing should be taken seriously," he said and instructed to check the misuse of revenue and raise the arrears. 

Published in The Rising Nepal daily on 6 July 2023.