Expecting a decent revenue growth, the Government of Nepal is looking at Rs 1,570 billion budget for the coming fiscal year 2018-19.
According to the Ministry of Finance (MoF) Nepal, the revenue collection over the next fiscal is expected to see a 30 percent rise standing at around Rs 950 billion, around Rs 220 billion more than the current fiscal target of Rs 730 billion.
According to Finance Secretary Shankar Prasad Adhikari, this target can be achieved through control of under-invoicing practice and boosting inland tax revenues such as Value Added Tax (VAT) and Income Tax (IT).
“The target is quite ambitious, but if we’re able to control under-invoicing, we’ll be able to achieve it,” says Shankar Prasad.
The government is also planning to increase revenue generation through domestic debt to Rs 153 billion from the previous year’s revenue of Rs 145 billion.
“If the economy grows by six per cent this fiscal, we can easily raise Rs 153 billion through domestic debt, which is an ideal ratio of domestic debt to gross domestic product,” says Prasad.
Besides, the Finance Ministry is also expecting Rs 17 billion surplus revenue from the unspent budget of the current fiscal.
Apart from this, the government’s reliance on foreign aid for grants, loans and technical assistance for budget financing is expected to touch the Rs 450 billion mark.
Substantial Rise in Foreign Aid
The government’s dependence on the foreign funding is expected to see a substantial rise in the coming fiscal to meet the domestic development needs across provinces and local bodies.
Towards this end, the government is planning to welcome around Rs 286 billion as foreign investment.
The current fiscal saw a budget allocation of Rs 232 billion with Rs 225 billion for local bodies and Rs 7 billion for provincial levels.
The new Nepali Government, yet to be formed, will undertake the formulation works of new budget for 2018-19 fiscal.
The initial estimation of the federal budget for the 2018-19 fiscal is yet to be presented at the Resource Committee meeting led by the Vice-Chairman of the National Planning Commission (NPC) of Nepal.