By Davis Mugabi
Uganda Revenue Authority – URA say that for Uganda to fund own budget, the country’s tax-to-GDP ratio has to double to 26%.
Speaking at the 6th URA Bankers Conference yesterday, Commissioner General John Musinguzi said: “Currently, we are funding 47% of the national budget leaving us to borrow the remaining 53%.”
“Our tax-to-GDP ratio is 13%, which is the lowest and below the average sub-Saharan African performance of 16%. Research has shown that for Uganda to fully fund its national expenditure, we need to at least double our Tax-to-GDP ratio to 26%,” Musinguzi noted.
According to the URA CG, Uganda’s Domestic Revenue Mobilization Strategy is geared towards improving revenue collection and increasing the tax-to- GDP ratio to 18% by the financial year 2023/2024. To this, he said that the role of financial institutions in this strategy cannot be under estimated.
“We require a collective effort and commitment for all of us in improving service delivery, client support, supporting business developments, industrialization, economic growth as well paying a fair share of tax revenue to support government programs, reduce on the level of economic dependence and improve the overall social welfare in our country,” he noted.
Musinguzi commended Bankers “for the great work you do towards developing our nation.”
“You are a key player in the Government’s domestic revenue mobilization efforts because of your strategic contribution in facilitating businesses through financial literacy, banking services, and payment platforms that enable taxpayers to honor their tax obligations. This is a vital component of our economic development. The economies world over have gone through major social and economic disruptions and it has become eminent that we must find ways of supporting and helping businesses stay afloat and also mobilize revenue internally for national development without relying on external aid,” Musinguzi said.
Whereas URA’s mission is to mobilize enough revenue for national development, Musinguzi said that “this is a journey we cannot travel alone.”
“We have purposed to continuously engage all key economic players, like you here and citizens in general so that we have a critical mass that can transform our nation. You are a vital link and an extension of URA services to the taxpayer and business community. You have the power to win over more taxpayers towards the path of tax compliance through their experience of the quality of your service,” he said.
On our part as URA, Musinguzi added: “We have re-purposed to improve our service delivery to boost compliance and to be a business enabler.”
“A healthy business environment is a win-win for all of us. It is from this environment that you get more clients and also the Government can collect revenue to provide social services. To achieve this, we have come up with several compliance enhancement initiatives and one of them is listening to our stakeholders and clients to understand their concerns and together develop smarter solutions to make life easier for them. We are also strengthening the use of technology to enrich the taxpayers’ experience and revenue administration. For instance, we are using artificial intelligence and data analytics to enhance our efficiency in evidence-based decision-making. We Continue to automate, update and integrate key business processes. We have also implemented smart business solutions like the Digital Tracking Solution (DTS) and Electronic Fiscal Receipting and Invoicing System (EFRIS). All these are premised on our internal commitment to be more efficient and transparent in what we do, guided by the values of Patriotism, Integrity, and Professionalism. We commit to continually improve our tax administration practice with the support of all relevant partners. As earlier mentioned, you are an extension of our efforts in securing Uganda’s economic independence. Due to this strategic position that you occupy, our efforts, without your participation, cannot yield much. I trust that together, and most importantly by the Grace of God, we shall make it,” Musinguzi said, calling upon “continued collaboration, commitment, and contribution towards this journey.”
