Revenue Collection Increases by 13% in the First Six Months of the Fiscal Year
Author
NEPSE trading
The Ministry of Finance has reported a total revenue collection of NPR 559 billion in the first six months of the current fiscal year. This marks a 13% growth compared to the same period in the previous fiscal year, where NPR 496 billion was collected. The revenue increase of NPR 63 billion is seen as a positive indicator amid various challenges.
The government has set an ambitious target of collecting NPR 1.419 trillion in revenue for the current fiscal year. As of mid-January, NPR 567 billion, including miscellaneous receipts, has been collected, achieving 40% of the annual goal. However, the mid-year target of NPR 672 billion fell short, with revenue collection reaching only 84% of the planned amount.
The Ministry noted that NPR 160 billion was collected in the month of Poush alone, showcasing steady month-on-month performance despite external pressures.
Several factors have influenced revenue performance:
Natural Disasters: Floods and landslides in Ashoj (September/October) disrupted economic activities, impacting revenue streams.
Petroleum Imports Decline: A reduction in fossil fuel imports led to decreased revenue from this sector, though there was a compensatory rise in electric vehicle imports.
Telecommunications Sector Slowdown: The sector experienced reduced contributions to the overall revenue pool.
Decreased Import Demand: Overall import volumes and consumer demand were lower, adding pressure to revenue generation efforts.
Despite these obstacles, the Ministry of Finance and Deputy Prime Minister Bishnu Prasad Paudel expressed optimism. “The growth in revenue collection compared to previous years is encouraging. We will continue to focus on achieving our targets,” Paudel remarked.
While the 13% growth is noteworthy, falling short of the mid-year target raises questions about the feasibility of meeting the annual goal. The reliance on imports, which has shown a declining trend, signals the need for a diversified revenue base. Additionally, sectors like telecommunications and petroleum require strategic interventions to stabilize their contributions.
The positive trends in electric vehicle imports could present a long-term opportunity for generating revenue from alternative industries. With focused policy efforts and recovery from natural calamities, the second half of the fiscal year could provide a clearer picture of whether the ambitious targets are achievable.
