581.41B revenue collected in 1st half of FY

Kathmandu, Jan. 16: The government’s revenue collection during the first half of the fiscal year 2025/26 has fallen significantly short of its target, raising concerns over mounting fiscal pressure in the remaining months of the year.

According to the Revenue Management Division under the Ministry of Finance, the government collected Rs. 581.41 billion in revenue by mid-January 2026. This is only 81.75 per cent of the half-year target of Rs. 711.21 billion. 

The shortfall amounts to approximately Rs. 129.8 billion. The revenue collected during the review period accounts for just 39 per cent of the annual target of Rs. 1,480 billion set for the entire fiscal year. 

The weak first-half performance is likely to intensify pressure on revenue mobilization in the second half of the fiscal year. For the month of Poush (December 16, 2025 to January 14, 2026), the government had targeted to collect Rs. 190.77 billion revenue.

However, only Rs. 171.63 billion was collected during the period, achieving 88.57 per cent of the monthly target. Although revenue collection of Rs. 20.26 billion on January 14 alone is viewed as a positive sign, it remains insufficient to offset the overall shortfall.

Despite missing the target, revenue collection has increased by 2.5 per cent, or around Rs. 14 billion, compared to the same period last fiscal year. 

The government had collected Rs. 567.40 billion by mid-January 2025. It was 39 per cent of the annual target of Rs. 1,419 billion of the last fiscal year. The government had collected revenue of Rs. 161.62 billion in the month of Poush last year.

Capital expenditure remains weak

Meanwhile, government spending, particularly capital expenditure, remains sluggish. 

According to the Daily Receipts and Payments Status report of the Financial Comptroller General Office, total budget expenditure stood at Rs. 690 billion by mid-January, representing only 35 per cent of the total budget allocation of Rs. 1,860 billion.

The capital expenditure performance has been particularly poor. Of the Rs. 407.8 billion allocated for capital spending in the current fiscal year, only Rs. 49.42 billion—just 12.12 per cent—had been spent in the first six months. 

This is 4.04 percentage points lower than the capital expenditure recorded during the same period of the previous fiscal year, when 16.16 per cent of the allocation had been spent. 

The recurrent expenditure during the review period reached Rs. 487.14 billion, accounting for 41.25 per cent of the total recurrent budget allocation of Rs. 1,180.98 billion.

The government had spent Rs. 452 billion under recurrent expenditure, accounting for 39.63 per cent of the total allocation, during the first six months of the last fiscal year. 

This shows that recurrent expenditure is higher by 1.62 percentage points during the review period compared to the corresponding period of the last fiscal year.

Similarly, spending under the financing heading stood at Rs. 153.64 billion, or 40.95 per cent of the total allocation of Rs. 375.24 billion.

The continued shortfall in revenue collection coupled with weak capital expenditure has raised concerns among economists about the government’s ability to stimulate economic growth and meet development goals in the current fiscal year.