Revenue Enhancement Action Plan and Strategy

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Revenue Enhancement action plan and strategy

Assignment project: Business strategy
Prepared By : Ajmal Rasheady
Date: 2013

Introduction
Municipalities in Afghanistan are created for management of city affairs and to provide for the general welfare of their inhabitants. In spite of this huge responsibility toward city and citizens, municipalities are the non-budgetary units of government and are authorized to generate their own revenues. Given this fact, we realize that urban development and welfare of citizens depends on increased generation of revenues. So, municipalities are legally obliged to strive to enhance revenues and judiciously utilize the sources to finance service delivery. Having that in mind, Farah municipality technically supported by UNDP-ASGP formulated a comprehensive revenue enhancement action plan and strategy for effective and efficient revenue administration and economic development. This support of UNDP-ASGP is highly appreciated. This action plan and strategy is not a sole product of Farah municipality and ASGP, but a key paper developed in collaboration with representatives of communities, businesses, PC and other government institutions including UNAMA. The main objective behind this participatory approach is a strong citizen-government movement in the area of municipal governance and development. This strategy was developed in March 2013 and is amendable given new needs arising or requirements of the time. It is a three major part action plan and strategy, with a high focus on capacity development of municipal staff and organization in all aspects. The parts are as follows:

1. Revenue Administration
2. Economic Enterprise Development
3. Revenue Projection

The municipality of Farah is fully committed to extend all efforts and resources to implement this strategy. However, support of people and donors is a big need so that the implementation is accelerated and this way Farah people see their needs accomplished. Implementation progress of this action plan and strategy will be monitored and evaluated by a special committee named “ Municipal Revenue Enhancement Committee”.

Analysis of organization: Revenues and Management
In order to put in place a good mechanism for monitoring and evaluation in the area of revenue enhancement and economic development, a brief of the current situation in Farah is presented to government, donors and all those interested in Farah. The revenue department of Farah Municipality is currently operating with 3 permanent staff inside Farah Municipality directorship, 6 revenue officers in Navahis (District offices), and 10 arrears officers. Below is a statement of Farah regular and variable revenues in 2012 which will best serve as baseline/basis for measuring any future progress. Farah revenue comparing in 2011 and 1012|

F ix Revenue | Revenue Resource| 2011| 2012| Difference | | Safayi Tax| 29776723| 51581639| 73|
| Vehicle and Border Tax| 53800952| 76013321| 41|
| Business and advertisement| 11590486| 16217105| 40|
| Turghundi border revenue| 0| 2067317| |
| Pakhta Company Share| 225249| 1117821| 396%|
| Business work permit| 2718038| 4403720| 62|
| Properties revenue| 30677868| 43448695| 42|
| Park Hotel revenue| 2199500| 2113630| 4|
| Market & SkinTax| 295000| 260000| -12%|
| Municipality Slaughter house Tax| 1641000| 2145000| 31| | Livestock Market Revenue| 530000| 720000| 36|
| Total Fix Revenue| 133454816| 00088248| 50%|
Variable R e venue | Building Maps Fees| 7549776| 12388503| 64| | Trees Selling| 2000000| 500000| -75%|
| Engineering Fees| 713460| 600600| -16|
| Price of Safayi tax logbook| 243450| 388651| 60|
| Payable Arrears revenue| 135642| 1417328| 945%|
| Properties Sales Revenue & Remaining| 117288| 165347| 41| | Fines | 174102| 1283605| 637%|
| Balance of A/C no 636|...
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