Amidst traders strike over high taxes, Ministry of Finance has tasked Uganda Revenue Authority to collect shs 13trillion so as to hit 2023 /2024 financial year target.
According to Henry Musasizi Minister of State for Finance, URA is projected to gather taxes amounting to Shs31.574 trillion to support the 2024/25 national budget. This marks a rise of Shs1.9 trillion from the current target of Shs29.672 trillion set for the fiscal year 2023/24.
He appealed to tax officials to carry out reforms in order to achieve the anticipated tax collection target.
“Implement and enforce electronic invoicing and receipt systems to make sure taxpayers keep accurate records, file their returns on time, and quickly determine their VAT obligations,” Musaazi said.
He said government and taxpayers will both gain from these measures, which are intended to improve the tax system’s efficiency, compliance, and openness.
Musaazi explained that the newly proposed taxes, which target industries like land transactions, petroleum, and cement, are intended to bring in an extra Shs1.902 trillion in income.
These suggestions are a component of the government’s calculated attempts to increase tax revenue collection and assist with important development programs that are listed in the national budget.
Jane Avur, Vice Chairperson, Committee of finance in Parliament expressed her worries whether the tax body will achieven the new tax target.
“According to the Commissioner General’s report, just Shs 19 trillion has been collected so far this year, despite the yearly revenue collection target being around Shs 29.6 trillion. URA must act quickly to implement corrective measures in order to close the deficit and fulfill the deadline of June 2024, “She said
Avur stressed that Uganda’s tax base seems to be deepening rather than expanding as a result of the introduction of new taxes.
She further alluded to the issue of the recently implemented cement building tax saying additional tax will have an impact on the broader public.
“Building project participants, including people and corporations, may face higher construction costs as a result of the new tax’s increased cement cost. This circumstance emphasizes how intertwined tax laws are, how they affect different economic sectors, and how they affect jobs and means of subsistence, “Avur stressed.
Avur said It is difficult to reach the anticipated tax revenue projections because of the small industrial base, which accounts for only 25 percent of the GDP, and the predominantly service sector, which accounts for 55 per cent.
In acomment, URA Commissioner General James Musinguzi said the tax body will rely on electronic tac registration and mass awareness of the business community to pay taxes.
In the FY 2022/23, URA had a net revenue target of UGX 25,151.57 billion. However, we surpassed this goal and collected UGX 25,209.05 billion. This represents a remarkable 100.23 per cent performance with a surplus of UGX 57.48 billion.
