KATHMANDU, July 20: The government met only 83.87 percent of its annual revenue collection target in the last fiscal year (FY), reflecting the perennial problems on persisting shortfall in the government projected amount.
In the FY 2024/25, the revenue collection stood at 83.06 percent while it was only 72.42 percent in the previous year, shows the records with the Financial Comptroller General Office (FCGO). For the past five years since the impact of the COVID-19, the government has been struggling to manage resources to meet its financial liabilities.
Diversifying Government Revenue
In the last FY, the government collected revenue of Rs 1.241 trillion against its annual target of Rs 1.480 trillion. In the last week of the FY alone, the revenue collection figure stood at Rs 60 billion.
Out of the tax revenue, the government met 84.57 percent of the annual target. Of the targeted Rs 1.325 trillion, the collection was only Rs 1.121 trillion. Regarding other revenue sources of the government, non-tax revenue collection stood at 77.87 percent to Rs 120.23 billion, while the grants receipt amount was 58.5 percent of the projected Rs 53.44 billion.
According to economists, prolonged economic slowdowns, sluggish domestic credit growth, and subdued market demand have severely constrained government revenue collection. On one hand, banks have been successively reducing their interest rates with an increase in liquidity with them, but it has failed to boost demand for loans.
Meanwhile, the government utilized only 46.79 percent of the development budget in the review period. According to the FCGO, the government spent only Rs 190.84 billion from the earmarked amount of Rs 407.88 billion. The government released Rs 93 billion in the last week alone of the FY 2025/26, revealing the last hour expenditure that could result in the poor quality development work.
