Revenue collection falls due to earthquake
As expected, the government missed its revenue mobilisation target by Rs 16.38 billion in the 10th month of the current fiscal year due to earthquake.
The government had planned to mobilise Rs 329.31 billion by mid-May but it has been able to mobilise only Rs 312.93 billion, according to the Finance Ministry.
Of the total, government has mobilised Rs 282.59 billion in tax revenue and Rs 30.34 billion in non-tax revenue, it added.
The government has targeted to mobilise Rs 422.9 billion revenue in the current fiscal year but devastating earthquakes on April 25 and May 12, and aftershocks have hit the customs hard pulling imports down drastically.
“Revenue mobilisation for the 10th month – from mid-April to mid-May – fell short by Rs 6.15 billion against the target of Rs 27.62 billion for the month. The government has been able to mobilise only Rs 21.47 billion,” the ministry said, adding that the government missed the target also due to increased value added tax (VAT) and tax deduction at source deadline has been extended until May 21 due to earthquake.
The VAT mobilisation contributed 28.91 per cent, income tax 21.09 per cent, customs 19.57 per cent, excise duty 13.09 per cent, and non tax at 9.7 per cent – of the total revenue – as of mid-May.
The Department of Customs missed the revenue target by Rs 5 billion in the 10th month of the current fiscal year 2014-15. The customs in Tatopani and Rasuwagadhi remained closed since April 25. Only last week, the department had ferried around 80 containers stuck at the yard of the Tatopani Customs to the Tribhuwan International Airport Customs in Kathmandu for clearance in police escort, the department said, adding that the imports through Birgunj Customs has also decreased since the devastating earthquake.
However, the Inland Revenue Department expects downturn in revenue mobilisation net month too as economic activities has stalled after the devastating tremor.
The department also projects revenue target deficit of Rs 11 billion to Rs 12 billion by the end of the current fiscal year.