Kathmandu Metropolitan City Revenue Collection Shows Upward Trend Over Six Years

Kathmandu. The trend of internal revenue collection by Kathmandu Metropolitan City has been encouraging in the past 6 years. Analyzing the data from fiscal year 2077/78 to 2082/083, it is observed that both the scope and volume of revenue collection have expanded.

Deepak Adhikari, chief of the department, presented a comparative statement at the orientation organized for ward secretaries and accounting staff regarding the Fiscal Act 2083, by the Revenue Department of Kathmandu Metropolitan City. In the orientation, Mahashakha Chief Bimla Koirala presented on the tax rates of previous years, amendments made to those rate titles, and annual targets.

Emphasizing the need to be sensitive to revenue discrepancies from the beginning of the current fiscal year, Finance Department Chief Dr. Shivraj Adhikari stated at the orientation that the time has come to work together in the zero discrepancy campaign. Similarly, Director Basanta Acharya clarified the spirit behind the formulation of the fiscal act.

In this process, ward secretaries presented their experiences and learnings regarding the practical situation of expectations from citizens, rates, and scope during revenue collection.

According to the comparative statement provided by Department Chief Adhikari, the total revenue collection increased from 10.64 billion rupees in fiscal year 2077/078 to 12.04 billion rupees in fiscal year 2082/083. This is the highest revenue collected in the last 6 years.

Significant Leap in House Rent Tax

Looking at the data of the past 6 years, 'House Rent Tax' has been established as the main source of income for the metropolitan city. The house rent tax collected in fiscal year 2077/078 was 1.61 billion rupees, which increased by more than 130 percent to 3.95 billion rupees by fiscal year 2082/083. Similarly, continuous growth has been observed in property tax as well. While 753.8 million rupees were collected 6 years ago, 1.19 billion rupees were collected in the previous year.

Improvement in Business Tax and Recommendation Fee

With the expansion of business activities, there has been an improvement in business tax as well. The business tax, which was 355.3 million rupees in FY 2077/078, reached 690.1 million rupees in FY 2082/083. The recommendation fee has also increased from 48.9 million rupees to 98.8 million rupees.

Decline in Map Approval Fee and Vehicle Tax

Revenue collection has decreased in some headings. There has been a significant fluctuation in the map approval fee. In fiscal year 2077/078, revenue collection was 533.8 million rupees. In 2079/080, 1.01 billion rupees were collected as map approval fee due to the building registration process. With the halt in building registration and decreasing space for building construction in the city, the income in this heading has decreased to 393.1 million rupees in fiscal year 2082/083.

Similarly, regarding vehicle tax received from the provincial government, only 206.2 million rupees were received in the last fiscal year, compared to 431.8 million rupees received in FY 2079/080.

Status of Grants

There has not been any significant change in the equalization grants and conditional grants received from the federal government. Equalization grants have remained around 700 to 80 million rupees annually, while conditional grants (current) received are 1.67 billion rupees, which is 250 million more than 6 years ago.

Target and Progress

The metropolis appears to be increasing its revenue target every year. While the target was 10.76 billion rupees in fiscal year 2077/078, it has been increased to 15.11 billion rupees in fiscal year 2082/083. Although the progress percentage compared to the target was around 79 percent in the previous year, the total collection amount is higher compared to previous years, according to the data.

FY 2082/083 Progress 79%: Encouraging Growth in Real Estate Registration

At the orientation, Department Chief Deepak Adhikari informed that due to the continuous efforts of central and ward employees working in tax administration under the leadership of people's representatives, about 79 percent progress was achieved against the total revenue target in FY 2082/083. According to him, as per the data from August 1, 2082, to July 31, 2083, against an annual target of 15.114341 billion rupees, 12.043385 billion rupees were collected.

Mixed progress has been observed in house rent tax and property tax, considered the main sources of revenue for the metropolitan city. Against a target of 6.25 billion rupees for house rent tax, 3.95 billion rupees have been collected, and against a target of 1.70 billion rupees for property tax, 1.19 billion rupees have been received.

Collection Exceeds Target in Real Estate Registration

Collection of real estate registration fees has been very encouraging in this fiscal year. Against a target of 1.64 billion rupees, 2.09 billion rupees have been collected, achieving more than the target. It is analyzed that better than expected revenue has been received in this heading due to the increase in real estate transactions.

Status of Grants and Other Fees

Regarding equalization grants received from the federal government, 648.6 million rupees have been received against a target of 799.5 million rupees. Similarly, conditional grants (current) have shown progress exceeding the target. Against a target of 1.5019 billion rupees, 1.67 billion rupees have been received. However, for conditional capital (federal), the progress is zero despite a target of 143.7 million rupees.

In other major headings, business tax has collected 690.1 million rupees against a target of 1 billion rupees. The department stated that 393.1 million rupees have been collected as map approval fee against a target of 500 million rupees. Similarly, 98.8 million rupees have been collected as recommendation fee.

Low Progress in Vehicle Tax

Progress has been low in vehicle tax, which is distributed through the Bagmati Provincial Government. Only 206.2 million rupees have been received against a revenue target of 399.0 million rupees. Value Added Tax and Excise Duty (Federal) are close to the target, with 353.0 million rupees collected against a target of 359.4 million rupees.