29th May 2023, Kathmandu
At today’s joint sitting of the Federal Parliament at 4:30 PM, Finance Minister Dr. Prakasharan Mahat is slated to submit the budget for the upcoming fiscal year. The budget will undoubtedly be perceived as “populist” and “Kanika Chare,” rather than helping the ailing economy.
Budget Size
A cap of 16 trillion 88 billion rupees has been set by the National Planning Commission for the budget of the upcoming fiscal year. However, according to reliable sources within the Ministry of Finance, the budget will be larger.
the control of resources
There aren’t enough resources right now. The budget will be presented assuming that about 50 billion rupees can be collected from donors, 5 billion rupees can be obtained via internal and external loans, and approximately 11 billion rupees can be raised from internal revenue.
Economic growth and price growth
The budget has a 7 percent economic growth objective. In a similar vein, an 8% price increase is predicted.
Scattered like a sower
The budget is going to be all over the place. The President’s recent policies and projects cover a wide range of subjects; therefore, it appears that the budget will be allocated in a similar manner. The budget will be presented by the finance minister by adding a few additional initiatives to the existing projects. The analysts opined that it would be smarter for the finance minister to focus on finishing up current projects as opposed to starting new ones. The finance minister, however, disregarded it and created the budget.
Promoting the stock market
The budget for this year also includes a line item for hiring non-resident Nepalis (NRN), as it has in the past. Similarly, the budget also addresses the subject of reorganizing NEPSE.
There won’t be a Parliament Development Fund introduced.
There won’t be a revival of the Parliament Development Fund. Since the nation has adopted federalism, if the Parliament Development Fund is reinstated, the money that was spent by the lawmakers would be in opposition to federalism, hence the fund would not be reinstated. The Parliament Development Fund won’t be presented because local governments have been given the authority.
Revenue rates will not change
Due to COVID, the global economy has deteriorated. Before the COVID-19-affected economy can recover, the war between Russia and Ukraine is pushing the economy back into problematic territory.
The rates of customs, income tax, and value-added tax are not appropriate to continue at this time, so the rates of revenue have not altered. Value Added Tax is now charged at a rate of 13%. It is being kept up.
Additionally, the income tax rate is up to 30%. And it’s not being used right now.
Alcohol and cigarette items will have higher excise taxes
Cigarettes, alcohol, tobacco goods, and cigarettes will all see a modest hike in excise duty. Each year, the excise charge on all of these products has gone up.
Luxury goods taxes will rise
Additional taxes will be added to some expensive goods. The tax rate will rise for expensive automobiles and motorcycles. Similarly to this, the practice of changing vehicles that run on petroleum products to run on electricity will be promoted.
Attempts to gain the trust of the private sector
The private sector is the engine of the economy. The business community is quite concerned. As a result, attempts have been undertaken to win over the business sector to the budget.
Budgetary efforts to fund international aid
The budget has been worked on to include international aid. They are foreign partners in development. Donors pay for roughly 75% of the capital budget.
Initiatives for attracting foreign direct investment (FDI) have been included in the budget.
Five Million Jobs Opportunity
The government has said in its policies and programs that 500,000 people will have jobs during the next two years. Agriculture and tourism have been given top importance because they are employment-generating industries.
No increase in salary of employees and allowances of senior citizens
The budget does not include an increase in staff compensation or senior citizen allowances. The current budget does not include any increases to employee or senior citizen allowances because the economy is in crisis.
The budget focuses on how to increase public confidence in the government.
