Finance minister says revenue gap can be filled through foreign aid
Kathmandu, May 4
Finance Minister Yubaraj Khatiwada has said that the government will fill the revenue gap caused by the COVID-19 pandemic through foreign aid.
Addressing the Finance Committee meeting of the Parliament today, Khatiwada said that groundwork is being laid to formulate the budget for next fiscal by mobilising more foreign aid. Moreover, he informed that the government has already received foreign aid commitment worth Rs 150 billion amid the ongoing crisis and commitment is increasing, which will help to bridge revenue gap.
“Revenue collection had been hit since the beginning of the current fiscal year due to different new customs measures and it has been hit rather badly in recent months due to the pandemic,” the finance minister said, adding that the government is working on different measures to fill this gap and raising foreign aid is one of the options.
According to him, the government was able to collect only one-fourth of the revenue target in mid-April and thereafter it has been even more sluggish. “While collection of revenue from customs is extremely low, even collection of other types of taxes is limited,” Khatiwada informed.
Acknowledging that the government is under severe pressure to manage revenue and resources under the new circumstances caused by the novel coronavirus pandemic, Khatiwada said that the government has cut unnecessary spending and is also seeking revenue sources.
The Ministry of Finance has already halted budget disbursement for different low-priority projects and programmes including different training programmes, vehicle procurement, awareness programmes, purchase of machinery and equipment, furniture, consultancy services, land acquisition, software development and purchase, among others.
By reallocating financial resources from these headings, the government intends to prioritise measures to combat the spread of the coronavirus and other liabilities resulting from the contagion.
Minister Khatiwada also informed that a sum of Rs 2.2 billion has already been collected in the COVID-19 Fund established by the government which it will mobilise in priority works, especially in preventing the spread of the coronavirus.
A version of this article appears in e-paper on May 5, 2020 of The Himalayan Times.