Finance Minister Dr. Prakash Sharan Mahat has presented a budget of 63 billion more than the ceiling given by the National Planning Commission (NPC) in the fiscal year 2023/24.
The NPC had said that resources of 16 trillion 88 billion rupees could be raised. However, Finance Minister Mahat presented a budget of 17 billion 51 billion rupees.
The ceiling suggested by the Commission and this year's size is less than the size of the previous year's budget size. But, Dr. Mahat brought a big budget without resources, experts have said.
According to the budget presented in the joint meeting of both houses of the Federal Parliament, 11 trillion 41 billion 780 million rupees i.e. 65.20 percent of the total budget has been allocated for recurrent expenditures. Similarly, 17.25 percent, i.e., 3 trillion 2 billion 70 million rupees has been allocated for capital expenditures while 3 trillion 7 billion 450 million rupees has been allocated for financial management. This amount is 17.55 percent of the total allocation.
If we talk about the resource, the estimated resource of expenditure for the next financial year is 12 trillion 48 billion 620 million rupees from revenue collection.
Even if 49 billion 940 million rupees is raised from foreign grants, there will be a shortfall in the total budget by less than 4 trillion 52 billion 750 million rupees. It is mentioned that 2 trillion 12 billion 750 million rupees will be collected from foreign loans to cover the shortfall, and 2 trillion 400 million rupees will be raised from internal loans.
An important resource mobilization is revenue collection. In the current financial year, the revenue collection is very poor. It is being analyzed that there has been a relaxation in the economy and the income has decreased in the industrial business. Due to this, the revenue is less collected this year.
Among the various heads of revenue, income tax is to be paid in the following financial year. This year's income tax should be paid in the next financial year.
As the business is weak in the current financial year, it is estimated that the income tax of the next financial year will be weak. Despite this situation, the finance minister has increased the size of the budget beyond the ceiling.
Economist and RSP MP Swarnim Wagle has said that the income target set by the government is unbelievable.
He says, "Budget is an estimate of income and expenditure. The income is incredible. Likewise, the cost estimate is misleading.
Former Finance Minister Bishnu Paudel says that due to the depressed situation of the economy, the revenue will not be mobilized as per the target."
He says, "From the point of view of revenue mobilization, we are in a depressed situation in the current financial year. Even the next year's budget cannot meet the target of revenue collection, capital expenditure, investment and economic growth of 6.5 percent."
With one and a half months remaining in the current fiscal year, only 56 percent of the revenue target set by Janardan Sharma last year has been collected. While aiming to collect 14 trillion 3 billion revenue, only 7 trillion 88 billion rupees have been collected.
The next year's budget is likely to follow the same trend.
But Chandra Prasad Dhakal, president of the Federation of Nepalese Chambers of Commerce Industry (FNCCI) and, the umbrella organization of the private sector, says that the budget has increased the self-reliance of the private sector.
He said, "The issue of promoting the private sector as a driver of the economy has been included in this budget. Some suggestions given by the FNCCI have also been included in the budget. A special initiative to increase capital expenditure and cut unproductive expenditure is welcome."