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Afghan government revenues 20 percent short of target

Source: Reuters - Sun, 5 Jan 2014 15:14 GMT
Author: Reuters
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KABUL, Jan 5 (Reuters) - Afghanistan fell about 20 percent short of its domestic revenue target in 2013 despite better tax collection as the economy slowed ahead of this year's planned withdrawal of foreign troops, the Ministry of Finance told Reuters on Sunday.

"There's concern that after the withdrawal of international troops, Afghanistan will fall again and that economic growth will drop," spokesman Abdul Qadir Jaillani said.

"There was tension created by the media and investors held back, which brought some problems in," he said regarding 2013.

The government collected about 100 billion Afghani (about $1.8 billion) toward a budget of 354 billion. The data is preliminary and figures are expected to be finalised this week.

FUNDS UP FROM 2012

Despite missing a target of about 123 billion Afghani, funds collected rose by about 15 percent from the previous year, the figures showed.

Still, most of the government's budget is provided by foreign aid and donors say that corruption continues to mar tax collection.

Afghanistan regularly ranks among the most corrupt in the world and diverting revenue is an easy way for powerful officials and warlords to boost their incomes.

"Weaknesses in administration and higher leakages, particularly in customs" play a significant part in weak tax collection, the World Bank said a recent report.

Jaillani said the government had worked to strengthen mechanisms for collecting taxes and that he expected further improvement this year.

"For the last three years we have concentrated on our revenue, we have trained our staff and worked on capacity-building," he said. "We are improving day by day."

"We are still optimistic. I think 2014 will be very good for Afghans because this is the year Afghans will take responsibility for their country."

The government's overall budget will rise in 2014, as donors seek to give Afghans increased control over the way aid is spent in the country.

($1 = approx 55.5 Afghani) (Reporting by Jessica Donati; editing by Jason Neely)

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