CONTENTS | ANB-BIA HOMEPAGE | WEEKLY NEWS
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Uganda |
ECONOMY
The Uganda Revenue Authority (URA) has set a target of collecting revenue that will fully finance the Ugandan government’s recurrent and development expenditure in the next five years
Speaking at the launch of the URA‘s Corporate Plan for the financial years 2002/03-2006/07 on 24 October 2002, Annebrit Aslund, the URA‘s Commissioner-General, said the plan’s main objective is to have proper planning in order to sustain a formal structure as an impetus for enhancing revenue collection.
The URA is a statutory body established on 5 September 1991, to administer central government taxes, with its main aim to professionalise tax collection so as to increase the amount of revenue collected. Justin Zake, the URAs Deputy Commissioner-General in Charge of Revenue, said: «In terms of revenue collection, we have grown reasonably. In the financial year 1990-1991, we collected about Ushs. 180 billion a year. Currently, the figure has risen to Ushs. 1.3 trillion. (The open market exchange rate for the dollar is currently about Ushs. 1,830). This is a tremendous improvement and shows what can be done if some of the issues we are advocating are properly put in place.»
To achieve higher tax yields, the five-year plan provides for widening the tax base, and strengthening the audit and investigation functions in the tax system. Aslund said this will involve development of an automated tax administration system, and enable the various revenue departments to determine how best to carry out their functions. Between July 2001 and June 2002, the URA has been undergoing a restructuring exercise.
Encouraging people to pay their taxes
The fact is, many people in Uganda who should be paying tax, are avoiding this duty. Feddy Mwerinde, the Commissioner for Expansion and Collection, says: «In spite of many positive measures that have been put in place by the revenue authorities, the number of taxpayers in Uganda is still low when compared to the country’s population.»
The URA has also launched a Taxpayer’s Charter aimed at encouraging taxpayers to comply voluntarily with paying taxes. It addresses the fundamental rights and obligations of the taxpayer, in enhancing awareness and promoting equity and fairness among all taxpayers.
Investors in Uganda have accused the URA of corruption, arrogance and time-wasting in clearing their goods at the country’s ports of entry. They have also called for tax policies that are fair and apply to all, and for the removal of the bureaucracy, which, they say, continuously frustrates their commercial activities.
To make clearance of goods easier for importers, the URA is discussing with them about ways and means of cutting down delays in the process of clearing imports. Zake said: «Since importers prepare their own Bills of Entry, we want them to assess themselves as they normally do, and pay the appropriate Duty levied into the bank. They will then bring the documents to the URA and if they have under-assessed themselves, they will have to top up before we release their goods». It should be noted that the Customs and Excise Department of the URA has automated all its manual systems to increase the speed of clearance time and facilitate both national and international trade.
In order to make tax payment easy for the taxpayer, the URA has increased the number of places where taxpayers can make their payments. In August 2001, six commercial banks were contracted to provide this service, in addition to the Uganda Commercial Bank which hitherto had the sole mandate.
The motorist has not been forgotten, either, as a number of banks have expressed interest in working with the URA to render services such as: The renewal of road licences; the renewal of Driving Licences; the issuing of Provisional Driving Licences; the payment of Driving Test fees. Sarah Mwoigeza of the Tax Education Department, says: «This approach will enable the revenue authorities to serve the taxpayers with more efficiency».
The URA under investigation
The URA itself has been subject to an ongoing Judicial Commission of Inquiry into alleged widespread and massive corruption and abuse of office. The Commission, headed by Justice Julie Sebutinde, was appointed in April 2002 and started work on 20 June 2002, Public hearings started in July 2002. The probe revealed massive corruption and abuse of office. Millions of dollars in taxes have been lost in tax-evasion, under-taxation, and corruption by some URA officials.
URA commissioners and staff had to disclose their assets, and a number of officials who appeared before the Commission couldn’t explain how they had accumulated their wealth. Some personnel were discovered to have assets incommensurate with their earnings. The Commission discovered that undeclared wealth amounting to Ushs. 3 billion had been amassed by some URA commissioners and staff. URA personnel have also been accused of taking bribes from tax-evaders, under-declaring their own tax situation and evading taxes.
If the URA is to achieve its long-term vision of increasing the national revenue, it has to clean up its own public image first of all.