Karnali Province Government Fails to Meet Revenue Targets

Surkhet. The Karnali Province Government could not earn income according to its target in the last financial year. The internal income of the Karnali government in the financial year 2082/083 has been 88 crore 99 lakh 60 thousand 793 rupees, which is 7 crore 74 lakh 50 thousand 207 rupees less than the target.

The government had brought a budget of 32 billion 99 crore 66 lakh with the target of earning 96 crore 74 lakh 11 thousand in internal income in that year. However, this year too, the government has failed to meet its target in internal income.

Before this, the highest income was 72 crore 53 lakh in the financial year 080/081. Income has increased by 16 crore 45 lakh 86 thousand last year, although the target could not be met.

Compared to the financial year 080/081, the internal income in 081/082 had decreased by about 8 crores. The Karnali government's income is not only unequal every year but also unbalanced due to the lack of actual identification of revenue sources and clear policies.

Except for two, the government has not been able to meet its internal income target in any financial year since the establishment of the province. There were no internal income activities in the first financial year. In the financial year 2077/078, the income was 50 crore 26 lakh against a target of 30 crore.

Similarly, in the financial year 2078/079, the income was 61 crore against a target of 60 crore. The government has not been successful in meeting the internal income target in any financial year thereafter.

The government seems to be increasing the rate of the target every year. From its establishment to the present, the government's internal income target is 5 billion 20 lakh 62 thousand, but the income has been only 4 billion 34 crore 76 lakh 91 thousand 576 rupees. This is 86.92 percent of the total target.

According to an official of the Ministry of Economic Affairs and Planning, the income is low because the government sets targets without identifying revenue collection sources. He said that the income is also low because the budget invested by the provincial government is concentrated in unproductive sectors.

As the provincial government makes no effort to improve its internal income, it brings more than 95 percent of the total budget every year relying on federal grants.

This is the target and achievement of internal income so far

In which headings and how much?

According to Dipendra Magarati, Chief Accounts Officer of the Provincial Treasury Comptroller Office, the revenue received by the province includes value-added tax, excise duty, and various royalties (minerals, forest, electricity, and mountaineering), which are received from the federal government's allocation.

Local levels collect house and land registration fees through the land revenue office, of which 40 percent is received by the province. Similarly, 40 percent of the vehicle tax is allocated to the local level.

He said that the taxes collected by the provincial government under its own authority are very low.

Although Karnali is called a region rich in tourism, only 11 lakh 22 thousand rupees have been collected as revenue under this heading. The provincial government has been allocating crores of rupees to the tourism sector every year. However, that amount is being spent in unproductive sectors. Every year, 80 percent of the budget allocated to the tourism sector is allocated to the temples of Kul Devta and institutions in the name of leaders, which does not contribute to the government's income.

Last year, 23 lakh 27 thousand from the sale of agricultural products, 3 lakh 92 thousand from the education sector, and 7 lakh 92 thousand from examination fees were collected as revenue. The highest income is from the transport sector at 1 crore 7 lakh and from vehicle tax at 27 crore 89 lakh. Income from forest royalty is 5 crore 85 lakh 67 thousand.

Last year, there was a plan to keep the income from forest products in the province, but the revenue did not increase significantly.

According to Ganesh Bahadur Chand, Senior Revenue Officer of the Ministry of Economic Affairs and Planning, the revenue did not increase as expected because it was the first year.

"Last year, as an implementation year, interactions were held with various local bodies, and laws were made," he said, "Also, provisions like not being able to collect agricultural tax and having complexities were removed."

He said that the complexities are now being resolved and practical work will be done.

Former Finance Minister says – the government did not pay attention to increasing internal income

Former Finance Minister Bindaman Bisht says that the government is not responsible towards increasing its internal income and becoming self-reliant.

He said that the government has not seriously considered exploring various aspects of income sources, increasing the tax base, and how to increase internal income.

"It does not seem that attention has been paid to increasing the tax base, systematically managing the revenue areas to be divided between local levels and the province, and how to manage the revenue areas in the provincial development council," he added.

Bisht says that discussions about how much income to set are held only when the budget is about to be presented, and it is not the government's agenda for the rest of the time. He suggests that new methods should be adopted in Karnali, where the scope of the sector is very narrow.