KATHMANDU, Jan 17: The government fell short of its revenue collection target by Rs 17 billion in the first half of the current fiscal year.
According to the Financial Comptroller General Office (FCGO), the government collected Rs 542 billion in revenues during mid-July and mid-January while the target was set at Rs 559 billion for the period. Of the amount, the government collected Rs 493 billion in tax revenue.
A decline in tax collection from the large taxpayers has hit the government’s set target of revenue collection. According to the Large Taxpayers’ Office (LTO), it collected only Rs 34.66 billion in taxes against its target of Rs 43 billion for a one-month period from mid-December to mid-January.
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The government has categorized a firm carrying out annual transactions of Rs 1 billion and more as a large taxpayer. There are 555 such firms operating across the country.
According to an official of the LTO, a surge in cases of the coronavirus in the past few weeks and a decline in tax collection from Nepal Oil Corporation (NOC) and Hydroelectricity Investment and Development Company Limited has resulted in a low amount of tax collection against the government target. During the review period, NOC had been facing losses triggered by the soaring prices of petroleum products in the international market.
The firms in the category of large taxpayers need to pay 40 percent of their projected annual income tax by the second quarter end, while the next 30 percent is to be paid in the third quarter and remaining 30 percent is settled at the end of every fiscal year.
Citing a possible shortfall of financial resources, Finance Minister Janardan Sharma has been pushing the government officials concerned to work aggressively on tax collection. In the current fiscal year, the government has targeted to mobilize Rs 1.18 trillion in revenue collection.
Meanwhile, three companies including Surya Nepal Pvt Ltd, Nepal Telecom and Ncell Axiata Limited each paid taxes of more than Rs 1 billion to the government during the review period. Nepal Electricity Authority and Gorkha Brewery, among others, were also in the top 10 list of companies paying a large amount of tax.
