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Govt revenue up by Rs. 1,172.4 bn in 8 months

2017-Nov-29 by  News Admin  

Total government revenue increased by 15.7% to Rs. 1,172.4 billion in the first eight months of 2017, compared to Rs. 1,013.4 billion in the same period of 2016, a Finance Ministry report said.

Tax revenue increased by 17.5% to Rs. 1,094.9 billion whereas non-tax revenue declined by 4.9% to Rs. 77.4 billion during the review period in 2017.

Domestic consumption base tax revenue increased by 26.9% to Rs. 342.3 billion in the first eight months of 2017, compared to Rs. 269.7 billion recorded in the same period.

This was mainly due to increased domestic Value Added Tax (VAT) revenue by 67.5% to Rs. 181.4 billion in the review period of 2017, compared to Rs. 108.3 billion in the same period of 2016, reflecting increased VAT rate to 15% from 11% with effect from November 2016.

Revenue from Nation Building Tax (NBT) also contributed to this increment on domestic base tax consumption.

However, revenue generated from liquor decreased by 5.9% to Rs. 73.6 billion in the respective period of 2017, due to declined consumption resulting from increased excise duty rates on liquor products.

Meanwhile the revenue from cigarette products declined by 8.1% to Rs. 54.6 billion in the review period in 2017, due to declined production stemming from increased tax rates on cigarettes. As a result, revenue collected from excise duty imposed on liquor and cigarettes dropped by 6.9% to Rs 128.3 billion in the review period of 2017.

Revenue from import base tax revenue increased by 16.3% to Rs. 552.1 billion during the first eight months of 2017, compared to Rs. 474.9 billion recorded in the same period of 2016.

The revenue generated from VAT on imports significantly increased by 61% to Rs. 108.6 billion mainly due to increased VAT rate to 15%.

Revenue from NBT on imports increased by 6.0% to Rs. 12.4 billion, resulting from the enhanced import base economic activities.

Revenue from Ports and Airports Development Levy (PAL) increased by 15.8% to Rs. 65.6 billion.

Meanwhile, revenue from Special Commodity Levy (SCL) increased by 23.4% to Rs. 49.2 billion in the reference period of 2017 benefiting the rate revisions done to encourage domestic productions.

Total revenue from excise duty imposed on imported items enhanced by 15.5% to Rs 184.2 billion in the first eight months of 2017.

The revenue generated from excise duty on motor vehicles increased by 8.0% to Rs 129.5 billion during the review period of 2017 due to increased vehicle imports by 2.1% to Rs 298,182.

Meanwhile, re-introduction of concessionary duty schemes on import of motor vehicles negatively impacted on government revenue.

In context of direct taxes, the revenue was increased by 9.1% to Rs. 171.0 billion in the first eight months of 2017 compared to Rs. 156.7 billion in the same period of 2016.

The revenue from Economic Service Charge (ESC) significantly increased by 181.7% to Rs. 31.2 billion due to increased tax rate to 0.5% from 0.25%.

Meanwhile, revenue from Pay-As-You-Earn (PAYE) increased by 18.6% to Rs. 22.4 billion due to improved tax administration and enhanced high wage employment in high earning categories such as professional services, etc.

However, revenue from corporate and non-corporate income tax marginally declined by 1.3% to Rs. 81.2 billion while revenue on tax on interest declined by 18.6% to Rs. 36.2 billion due to lower issuance of Treasury Bills and Bonds.

In the meantime, revenue from Telecommunication Levy (TL) declined by 1.6% to Rs. 23.3 billion during the first eight months of 2017.

Non-tax revenue declined by 4.9% to Rs. 77.4 billion in the first eight months of 2017 compared to Rs. 81.4 billion recorded in the same period of 2016.

Government expenditure consisting of recurrent and capital expenditure increased by 18.0% to Rs. 1,694.9 billion in the first eight months of 2017 compared to Rs. 1,499.1 billion recorded in the same period of 2016.

Recurrent expenditure increased by 11.6% to Rs. 1,294.3 billion mainly due to increased interest payment by 25.1% to Rs. 518.6 billion due to increase in interest rates during the period.

Salaries payment and pension payments increased by 3.6% to Rs. 392.5 billion and by 5.9% to Rs. 120.2 billion during the review period of 2017 due to increase of basic salary from 2016.

Meanwhile, capital expenditure increased by 17.9% to Rs. 400.5 billion in the first eight months of 2017 compared to Rs. 339.6 billion in the same period of 2016.

The expenditure in welfare programmes marginally declined by 2.8% to Rs. 113.6 billion. Public investment increased by 16.1% to Rs. 404.8 billion in the period of January to August, 2017 compared to Rs. 348.7 billion recorded in the same period of 2016.

The overall budget deficit was Rs. 520 billion during the first eight months of 2017 compared to Rs. 485 billion in the same period of 2016. 

Sources : dailyNews

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