 |
|
| Kathmandu, Friday January 03, 2003 Paush 19, 2059. |
|
Govt to issue finance
ordinance next week
Present budget to be continued, no major
change
By Prem Khanal
KATHMANDU, Jan 2 : The forth-coming financial ordinance that the government is
planning to issue next week would be a continuation of the current budget and would have
no major policy-wise change except for some minor administrative and institutional
reforms. A high-level government source informed The Kathmandu Post that the Ministry
of Finance has completed all necessary preparation regarding the issuance of the ordinance
and is planning to get it approved from the cabinet Monday. A high-level delegation from
the Finance Ministry including Finance Minister Dr Badri Prasad Shrestha presented a
briefing about the ordinance to the His Majesty the King on Wednesday.
The source also said that the ordinance will
bring no change in the existing customs rates, but would take some concrete measures to
reform the present revenue administration to stem revenue leakage. The source also
informed that the ministry has been seriously looking into the possible steps that can be
immediately taken to check revenue leakage.
With an aim to contain the leakage in the
collection of customs duties mainly through under-valuation, the government through
ordinance is also planning to bring reference price of major imports of the country.
Similarly, the government would also introduce a mechanism to track the status of raw
materials that the domestic industries’ import at nominal customs duties.
Despite repeated appeal to provide some relief
to recession-hit private sector, the source said that the government is not in a position
to fulfil the demand due to less-than-expected performance of the revenue collection and
soaring regular expenditures. “Though the government is in dire need of extra
resources to bridge resource gap due to lesser revenue mobilisation, it will not increase
the present existing tax rates given the sluggish economy,” said the source.
The source also said that the development
expenditure allocated for the current fiscal year would not be changed. “Since there
are a lot of complications to change the development budget in mid-year, the upcoming
ordinance would not make any change in the development expenditures,” added the
source.
In response to the low actual development
expenditure, which is just around Rs three billion during the first five months of the
current fiscal year against the released amount of Rs 4.19 billion as of mid-December, the
ordinance might bring some minor policy-level change to boost the development
expenditures.
The ordinance will also take proper measures to
ensure adequate flow of budget to the priority one projects categorised under Medium Term
Expenditure Framework (MTEF) and its effective and speedy implementation. “The
Finance Ministry is committed towards the smooth release of budgets to the 186 prioritised
projects under MTEF,” said the source.
With a basic motto of ‘Investment for Peace’,
the then Prime Minister and Finance Minister Sher Bahadur Deuba had presented a Rs 96.12
billion budget for the current fiscal year through an ordinance promulgated by the King.
The government has been compelled to bring a new financial ordinance for the rest of
period as per the constitution the ordinance would automatically expire within the six
months of its issuance if not endorsed by the parliament.
Former PM Deuba had allocated Rs 57.44 billion
for regular expenditure, an increment of 16.46 per cent against current fiscal year’s
estimated regular budget, while on the development front, he had proposed Rs 38.67
billion, which is 23.1 per cent less than the amount earmarked for this year.
However, given the current trend, the total development budget for the current year is not
expected to remain around Rs 30 billion due mainly to continuing violence. A source of the
National Planning Commission said government might not be able to use the foreign grants
worth around Rs 7 billion extended for the development activities.
The ordinance will not have specific programmes
to expedite financial sector reforms, said the source adding that the government is
planning to take concrete measures only after a high-level task force formed recently to
review the reforms processes submits its report.
Other Stories
|
