In the coming financial year (2018/19), which is just two months away, Uganda Revenue Authority (URA) will be required to domestically raise Shs16.2 trillion. Out of that, about Shs418b is expected to be raised from non-tax revenue.
This amounts to about 53 per cent of the total resource envelope, which is estimated at nearly Shs30 trillion. The theme of the budget as it stands: “Industrialisation for job creation and shared prosperity,” is a key slogan that rhymes well. The question now is; will the implementation follow the rhythm? However, given past trends there has been a variance between revenue projections and actual collections. In the financial year 2016/17 net collections stood at Shs12.7 trillion, registering a shortfall of about Shs500b.
The deficit was about the size of the current budget allocated to the ministry of Agriculture and slightly more than four times the current budget of the ministry of Trade. To cover up the deficit, government was compelled to rely on external and domestic debt, which currently stands at 27 per cent of GDP, according to the 2017/18 Budget Speech.
So far the second biggest expenditure of the budget will go towards servicing interests on debts secured by government. According to a report by the Parliament’s Committee on National Economy for the 2016/17 financial year, the rate at which Uganda is paying off its debt, will take approximately 94 years or more to repay the existing stock of debt. Uganda Debt Network Research indicates that the total public debt by June 2017 was in excess of $13b (about 47.5 trillion) while Bank of Uganda has put the “provisional total public debt stock (at nominal value) as at end of December 2017 at Shs37.9 trillion.
Nelly Busingye Mugisha from Tax Justice Alliance presenting the CSO position on Tax Revenue Measures for FY 2018/19. On the right is the committee chairperson Hon Henry Musasizi.
At the 8th sitting of the 3rd meeting of the 2nd Session on the 10th Parliament of Uganda held on the 3rd April 2018, the Minister of Finance, Planning and Economic Development tabled the following Tax and Revenue Bills:
As concerned citizens, today Tuesday 24th April 2018, the Civil Society Organizations under the Tax Justice Alliance, presented their position on Tax Revenue Measures for FY2018/19 to the Parliament Sectrol Committee on Finance, Planning and Economic Development.
The Alliance welcomes the following tax proposals to improve revenue collection and facilitate investment in the FY 2018/19 and beyond including:
On the right; Hon David Bahati the State Minister Ministry of Finance, Planning & Economic Development during the session
However there are a number of concerns that the CSO members wish to be considered before passing the Bills into Law.
Hon Henry Musasizi the Chairperson of the Parliament Sectrol Committee on Finance, Planning and Economic development wondered why the Ministry of Finance was proposing to re-introduce tax on SACCO’s which had been given a 10 year exemption just last year. In his response, Hon David Bahati explained that government wishes parliament to reconsider that decision since some SACCOs make quite a considerable amount of profit and therefore need to pay tax on it.
Hon Nandala Mafabi a committee member raised the issue of double taxation on the proposal to levy a Shs 200 per user per day of access on over the top services. This he said was unjust since the consumer.