Four-Month Revenue Collection Amounts To Only 20 Percent Of 2018 Target
Source: Vientiane Times
The collection of revenue throughout the nation over the past four months has reached 5,297 billion kip, equal to only 20.81 percent of the figure targeted for the whole of 2018.
The Ministry of Finance recently unveiled its report on revenue figures from January to April, highlighting the need to quickly ensure payment of taxes and fees into the national budget for the rest of the year.
The ministry is exerting every effort to fulfil the government’s revenue collection goal of 25,452 billion kip for 2018.
Of the 5,297 billion kip collected in the first four months of the year, 5,226 billion kip comes from domestic sources in the form of taxes (2,335 billion kip), tariffs (1,643 billion kip), state asset management and other fees.
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Income sourced from grant aid amounted to only 70.43 billion kip, equal to just 2.56 percent of the plan for 2018.
The revenue shortfall could increase the pressure on the government to seek more funding to cover planned budget expenditure for the rest of the year.
The government’s monthly meeting on April 23-24 instructed the relevant sectors to amass more revenue in the second quarter of the year.
Chaired by Prime Minister Thongloun Sisoulith and attended by other cabinet members, the meeting urged authorities to capitalise on the country’s potential to boost income.
The government also called for the relevant sectors to intensify their battle against financial leakages and all attempts by businesses to avoid paying taxes.
Laos has suffered from a revenue shortfall in several successive years, further escalating budgetary tensions and affecting economic growth and national development.
The main challenge is that the country’s expenditure needs are higher than its capacity to source revenue for development purposes.
In 2017, the government planned to collect revenue of 23,801 billion kip and expenditure was set at 32,262 billion kip. But this plan was not fulfilled.
The Ministry of Finance agreed it was important to use electronic systems in the collection of revenue to ensure transparency and accountability, as well as remove loopholes that allow corruption on the part of officials.
One scheme that has been successful and could serve as an example is the payment of road tax, which is now being done by members of the public through the BCEL bank.
Using the bank’s electronic system, all road tax is paid directly into the national budget. Vehicle owners who failed to pay road tax in 2017 will be fined and forced to make payments retroactively in addition to paying the tax due in 2018.
Critics say it’s essential to carry out further tax reforms, especially in the payment of land taxes, and to clearly define all sources of revenue as well as make sure finance officials act more responsibly in the collection of taxes.