Himalayan News Service
KATHMANDU: Despite registering the increment of 30.9 per cent in the government expenditure, in the first nine months of the current fiscal year, government has observed the budget surplus of Rs 10.3 billion.
According to the Nepal Rastra Bank (NRB)’s macroeconomic report of nine months of the current fiscal year, the government budget surplus on cash basis stood at Rs 10.30 billion compared with a budget surplus of Rs 12.72 billion in the same period last fiscal year. “The budget surplus stood at Rs 4.94 billion in the eighth month of the current fiscal year,” according to the central bank.
Meanwhile, the total government spending has increased by almost a double at 30.9 per cent amounting to Rs 140.09 billion, due to higher recurrent and capital expenditure, in the mid-April, which had increased by 18.5 per cent only in the same period last fiscal year.
The recurrent expenditure alone has increased by 28.5 per cent to Rs 90.94 billion due to increased salary and allowances of civil servants, rising expenditure on special security plan, larger subsidies to public schools, increased economic assistance,” the report said. Similarly, capital expenditure has also increased by
47.5 per cent to Rs 28.35
billion which had declined
by 2.5 per cent in the same period last year.
“Only 26.7 per cent of the budget estimate on capital expenditure has been spent so far,” the NRB said. The low expenditure has been due to delay in the approval of budget, lingering in the contract process, absence of representatives in local bodies as well as weak law and order situation in the country. In the eighth months, only Rs 79.37 billion of recurrent budget and Rs 22.45 billion of capital budget had been spent.
A positive impact of ‘Tax Compliance Year’, increase in PAN number holders, mobilisation of tax volunteers, control in revenue leakages and tax administration reforms has contributed to 28.2 per cent growth of revenue mobilisation to Rs 126.53 billion, whereas in the eight months the revenue mobilisation was at Rs 105.58 billion. The revenue collection has slowed down as in the last fiscal year’s same period, government had been able to register a growth of 39.3 per cent.
“Value Added Tax (VAT) contributed most to the total revenue as it grew by 40.6 per cent to Rs 38.50 billion. It had increased by only 23.2 per cent in the same period last year,” said the report. “In the eighth month also, VAT had grown by 43 per cent registering Rs 33.36 billion in the government’s kitty.” Increased consumptions and reforms in VAT administration has been attributed to such a growth in VAT. Similarly, Increase in imports of high tax yielding vehicles and spare parts pushed the customs revenue up by 35.9 per cent to Rs 25.07 billion compared with 25.7 per cent rise in the same period of last year. Customs collection had grown by 43 per cent in the eighth months of the current fiscal year.
Excise revenue increased by 60.3 per cent to Rs 16.94 billion against an increase of 45.1 per cent in the same period of last year. Likewise, a positive impact of tax compliance year and increase in PAN number holders has attributed to 22.2 per cent increase in income tax amounting to Rs 23.47 billion. In the first eight months, it had grown by 20.7 per cent to Rs 17.52 billion.
However, non-tax revenue has declined by 8.6 per cent to Rs 16.07 billion compared with an increase of 68.7 per cent in the same period last year.