The collection even surpassed the target, which was set at Rs 74.97 billion, by 6 percent. Concerned officials attributed the growth to increased domestic consumption, which led to sharp rise in imports, and also the ´fine tuning´ of revenue administration and policy to effectively tap revenue. [break]
Ministry of Finance (MoF) in particular attributed the higher collection growth rate to reforms introduced in the way revenue system functioned and the new measures adopted to plug revenue leakage.
“Steps like installing of border posts in all 64 customs points, switching to computerized mode of operations at all customs and installing of flow meter in beer factory greatly helped check customs and excise leakage,” said Revenue Secretary Krishna Hari Baskota.
Increased investigation capacity of Inland Revenue Department (IRD), which went on to slap fines and recoup huge VAT theft, also generated additional revenue and left the demonstration effect.
As usual, value added tax (VAT) stood as the largest revenue contributor for the government during the period. It generated Rs 24.30 billion in revenue during the first six months. MoF statistics further shows that customs duty became the second largest contributor with Rs 16 billion.
The government mobilized Rs 15 billion from income tax, while collections from excise duty jumped to Rs 10.80 billion during the period. Likewise, the government collected Rs 2.95 billion from registration fees, Rs 1.55 billion from vehicle tax and Rs 9.10 billion from non-tax revenue sources.
Even though all key sources posted a sound growth in collection, concerned officials said they are still worried about low enforcement of VAT in the market.
The government has set a target to collect Rs 176.50 billion in the current fiscal year. To realize it, the collections need to grow by an average 24 percent over what was mobilized in the last fiscal year.
“Given that our collection rate has consistently remained higher than 34 percent, we are confident of realizing this target easily,” Baskota said.
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