Govt eyes fuller coffers with new revenue collection plan
Govt eyes fuller coffers with new revenue collection plan
The Ministry of Finance is planning a major increase in revenue collection next fiscal year so that it can give government officials their promised pay rise from October.
Finance Minister Mr Phouphet Khamphounvong yesterday presented a draft of the government's budget for fiscal year 2012/2013 for the National Assembly to consider and approve before the budget plan comes into effect in October.
“The proposed revenue increase is significant and has never been possible in the past,” Mr Phouphet said as quoted in his statement at the third session of the seventh legislature of the National Assembly, which opened in Vientiane yesterday.
He said the Ministry of Finance expects to collect more revenue from taxes and state service fees, the timber industry, dividends from enterprises in which the government holds shares, and fees imposed on foreign airlines that enter Lao airspace.
Under the proposed budget, the government plans to collect 19,543 billion kip (US$2.4 billion), a 24 percent increase compared to the current budget. The proposed revenue will account for 24.21 percent of GDP, which is expected to reach 80,720 billion kip (U$S10 billion).
Domestic revenue sources are set to contribute 14,933 billion kip, 29 percent more than at present. The government expects to receive 4,610 billion kip as Official Development Assistance from overseas development partners, about 8 percent more than at present.
Mr Phouphet said the government planned to spend 23,385 billion kip (US$2.9 billion), about 23 percent more than the current plan. The proposed expenditure will account for 29 percent of GDP.
The government plans to spend most of the revenue on salary and living allowances for state officials so that they can improve their living standards and focus more on their work. Expenditure on government salaries and living allowances is expected to reach 4,676 billion kip (US$584 million) this fiscal year.
The government will also budget 2,088 billion kip for administrative costs, 2,600 billion kip for state investment projects, and 4,258 billion kip to pay off domestic and foreign debts.
The Ministry of Finance expects the budget deficit to be 3,842 billion kip or 4.76 percent of GDP. The government plans to borrow 1,742 billion kip from foreign countries and sell bonds so that it can cover its budget.
Mr Phouphet said that in the past eight months of this fiscal year, the government collected 10,568 billion kip, or 66 percent of the annual plan, an increase of 11 percent compared to the same period last year.
The government expects revenue collection will exceed the target 5 percent thanks to the rising price of copper and gold, one of the country's major export commodities.
The government spent 10,543 billion kip, amounting to 55 percent of the annual plan. The finance ministry expects that the remaining revenue will be disbursed in accordance with the existing budget.
vientiane times
