KATHMANDU, March 24: The number of taxpayers who have taken permanent account numbers (PAN) has reached 6,659,836, with a notable number of individuals and companies registering in the government tax system.
The records with the Ministry of Finance (MoF) show the notable rise in taxpayers as of mid-February this year. Of the total PANs registered during this period, the ratio of commercial permanent account numbers, permanent account numbers taken by taxing agencies, and personal permanent account numbers is 30.2 percent, 0.5 percent, and 69.3 percent, respectively.
According to the MoF, a total of 433,703 taxpayers were added to the tax offices in the first seven months of the current fiscal year. During the corresponding period of the last FY, 426,330 taxpayers took the PAN cards.
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Similarly, a total of 341,716 business entities were registered for Value Added Tax (VAT). Similarly, 123,132 firms got registration for excise duty.
Time and again, the government has been reiterating to reform the revenue collection system through expanding economic activities within the country, promotion of investment, and encouragement for entrepreneurships within the domestic production sectors.
“The revenue scope will be expanded and the tax base protected, thereby developing a sustainable, transparent, and equitable revenue system. The tax scope would be expanded and tax compliance would be increased through taxpayer education and awareness programs,” reads the budget announcement for the FY 2024/25.
Despite a significant increase in the number of taxpayers following the budget announcement, the government's revenue collection has remained pathetic over the period. Although the revenue collection increased by 10.5 percent in the review period, the amount however shows a shortfall compared to the target set by the government.
As of mid-February, income tax collection grew by a nominal of 3.2 percent despite a notable rise in PAN registrations. On the other hand, excise duty increased 21.1 percent, customs revenue collection increased 14.3 percent and VAT collection grew by 10.7 percent.
The government has set a target of collecting Rs 1.419 trillion in revenue in the current fiscal year, but it stands at only Rs 736.86 billion, a 51 percent of the target as of Saturday, in the middle of the ninth month, shows the records with the Financial Comptroller General Office.
With the surge in government expenditure of Rs 868.97 billion amid slow revenue collection, the government has been facing a crunch in its financial resources to manage its immediate liabilities. The government's budget deficit has stood at Rs 132.11 billion as of the third week of March.