Sluggish customs growth has govt worried
Sluggish growth in revenue collection of major customs offices has the Ministry of Finance (MoF) worried. Such is the situation that Revenue Secretary Krishna Hari Banskota on Friday warned of transferring customs office chiefs failing to meet the revenue target.
“While introducing yourself, do not forget to inform whether your office has met the revenue target,” Banskota told customs chiefs at ‘Performance Evaluation Seminar’ organised by the Department of Customs (DoC) here. “Anyone failing to meet the target may be prepared for the transfer.”
However, the revenue secretary’s warning failed to budge customs chiefs. Labanya Dhakal, chief of Birgunj Customs, made it clear that his office cannot meet this year’s target. “You can transfer me,” said Dhakal. The Birgunj Customs is the largest revenue contributor to the country.
Dhakal’s straight forward answer made the revenue secretary serious. “Birgunj Customs must meet the target at any cost, as the country cannot achieve the total revenue target even if all other customs offices meet their targets and this one fails,” said Banskota. “It is a must, even if the finance minister, I and the director general of DoC are required to stay at Birgunj customs for the purpose.”
However, Dhakal poured cold water on the secretary’s expectation. “We cannot achieve the target even if the entire Singh Durbar (key government administrative offices) stations at the Birgunj Customs,” said Dhakal. He asked how the target could be met without improvement in business activities that have slowed down this year. Dhakal complained that the target for the Birgunj Customs this year—Rs 52 billion—is too high. The target was increased by Rs 14 billion this year although the expected annual growth usually stood at Rs 5 billion.
“The target is unlikely to be met due to decline in the import of vehicles, cement and clinkers,” he said. As of the ninth month of the current fiscal, the Birgunj customs has been able to collect Rs 34.4 billion against the target of Rs 36.8 billion, which is 94 percent of the target.
Revenue should grow by 20 percent to meet the total revenue target, but the growth has been sluggish. The government has set the overall revenue target at Rs 216 billion this year. As the country’s economy is import driven, decline in import of major products has resulted in loss in revenue. As of the seventh month of the current fiscal, import has declined by 0.1 percent, according to the Nepal Rastra Bank.
Customs office chiefs from across the country had attended the seminar. The department organises the seminar every year to review the valuation of goods at customs points. The seminar usually increases or decreases the valuation of goods that are imported from India and China without opening the Letter of Credit (LC).
Ministry officials said adjustment of the valuation of goods cannot be done by organising seminars, as the country has endorsed the General Agreement on Trade and Tariff (GATT) valuation. The DoC had endorsed GATT in 1998 and incorporated it in the Custom Act in 2007. As per the GATT, goods should be cleared from the customs on the basis of transaction cost. The transactions cost includes transportation and insurance costs.
However, a joint secretary of the ministry said the revenue collection could be affected if valuation is based on transaction cost, given rampant undervaluation of goods in customs points.
Posted on: 2011-04-24 09:54
Post Your Comment
Today's Paper
The Kantipur in Print
FROM THE PAST 7 DAYS
ENTER KEYWORD OR DATE
FROM THE PAST 7 DAYS
ENTER KEYWORD OR DATE
Abin
All of them discussed the issue. The result was the same...and we have committed to continue discussions on the issue till midnight.
ADVERTISEMENTS
OUR PUBLICATION :
