Revenue Collection Increases by 17% in Q1 of FY 2024/25, but Misses Target

Nepal’s revenue collection for the first quarter of Fiscal Year 2024/25 saw a 17% increase compared to the same period last year, amounting to NPR 323.24 billion. However, this fell short of the targeted NPR 406.37 billion for the period, achieving only 80% of the goal.

The Ministry of Finance, in a meeting of its Higher Management Committee, revealed that the revenue collection target for the entire fiscal year is NPR 1,419.30 billion, a 34% increase from the previous year’s actual revenue. Despite the improved performance compared to last year, the government faces challenges in meeting its ambitious target.

A historical comparison of revenue collection over the past five fiscal years highlights mixed outcomes:

• FY 2076/77: 71.38% of the target achieved.
• FY 2077/78: 92.50% of the target achieved.
• FY 2078/79: 90.24% of the target achieved.
• FY 2079/80: 68.23% of the target achieved.
• FY 2080/81: 74.54% of the target achieved.

Deputy Prime Minister and Finance Minister Bishnu Prasad Paudel emphasized the importance of resource and expenditure management to achieve revenue goals. He called for expanding the tax base, collecting arrears, improving tax administration, and addressing challenges in customs and tax collection systems. He also directed stringent legal action against those undermining the tax collection process.

Finance Secretary Dr. Ram Prasad Ghimire stressed the need for robust implementation of revenue collection strategies and urged all stakeholders to intensify efforts to meet the annual target. Similarly, Finance Ministry Spokesman Mahesh Bhattarai underlined the importance of coordination and cooperation among tax administration entities to bridge the gap between the current performance and the set goals.

Customs Department Director General Harisharan Pudasaini and Inland Revenue Department Director General Ram Prasad Acharya reassured that they are working diligently to address the challenges and seize opportunities in the revenue collection process.

Despite the shortfall, the Ministry remains optimistic about meeting the annual target by prioritizing strategic reforms and strengthening inter-departmental collaboration.