KATHMANDU, Feb 14: Although the government revised revenue collection target through the mid-term review, it still seems to have failed in its goal as the amount realized stood less than 50 percent of the targeted annual revenue collection.
The records with the Financial Comptroller General Office (FCGO) show that the government collected Rs 642.85 billion during the review period, while the revised revenue target is Rs 1.286 trillion. Citing the slow revenue collection, the government has downsized the revenue collection target by Rs 133 billion to Rs 1.286 trillion for the FY 2024/25.
Considering the original amount that the government announced through the annual budget, the revenue collection stood at only 45.29 percent in the first seven months. Initially the government had maintained the revenue collection target at Rs 1.419 trillion.
The amount collected during mid-July 2024 and mid-February 2025 is even less than the amount targeted for the first six months. According to the Ministry of Finance (MoF), the government’s target as of mid-January this year stood at Rs 672.80 billion.
The MoF in its mid-term review has attributed the inadequate revenue collection to the ongoing economic slowdown along with the decline in imports of a number of goods. In the review period, there was a heavy decline in customs revenue earnings from import of goods like diesel, footwear, iron, tiles, tobacco, MS billet, small cardamom, fruits, aluminum wire, crude edible oils and wine, among others.
The MoF has acknowledged that the ineffective market monitoring and failure to control cross-border smuggling of goods have also resulted in the shortfall in revenue collection. “Likewise, expanded tax subsidies provided to a number of goods have also impacted the revenue collection in recent days,” reads the half yearly review of the MoF.
Meanwhile, the government spent only 19.42 percent of the amount allocated in capital expense in the first seven months. The government utilized Rs 68.41 billion in the development projects out of the earmarked budget of Rs 352.35 billion.
The amount spent on the heading makes up only 22.84 percent of the amount revised through the mid-term review. The government reduced the capital expenditure for this FY by Rs 52.85 billion to Rs 299.50 billion.