Government Revenue Rises by 7.8% in First Two Months, Yet Falls Short of Annual Target Expectations

In the first two months of the current fiscal year (2024/25), the government collected Rs 166.38 billion in revenue, marking a 7.8% increase compared to Rs 154.24 billion collected in the same period last fiscal year. This rise reflects an uptick in economic activity, though the growth rate has fallen short of government expectations. The revenue collected so far accounts for only 11.72% of the annual target of Rs 1.419 trillion, signaling that the government may miss its target again this year.

The Financial Comptroller General Office (FCGO) reported that, while there has been a slight improvement in government expenditure, with spending reaching Rs 137.55 billion (7.39% of the annual target), capital expenditure for development projects remains a challenge. Despite reaching Rs 14.89 billion in the first two months, this is just 4.23% of the Rs 352 billion target for the fiscal year. Last year’s capital expenditure stood at only Rs 8.17 billion during the same period.

Experts highlight that the inability to meet both revenue and expenditure targets, especially in capital expenditure, undermines economic growth and development. Historically, the government spends a significant portion of the capital budget during the last month of the fiscal year, which delays progress on construction and development projects.