John R. Musinguzi, the URA Commissioner General during the interview
Today September 15th 2021, Uganda Revenue Authority (URA) will commemorate its 30th anniversary with a Thanksgiving service at Kololo Independence Grounds. President Yoweri Museveni is expected to grace the event as the Guest of Honour.
As the tax body celebrates 30 years, Business Focus interviewed John R. Musinguzi, the URA Commissioner General, about the tax body’s 30-year journey, achievements, the future and a wide range of issues regarding revenue mobilization and collection.
Below are the excerpts of the interview;
How do the recent changes in the URA Mission, Vision and core values relate to the URA mandate of revenue mobilization at a time such as this?
The URA mandate is to administer, mobilise, collect, and account for all domestic taxes. Our new mission therefore is to ensure that we mobilize revenue for National Development in a transparent and efficient Manner. Enhancing transparency and accountability in the tax solution is paramount to ensuring that all those required to pay, do pay what is due. We envision URA to become a transformational Revenue Service that will ultimately deliver Uganda’s economic independence.
For us to be able to effectively deliver on our Mandate as spelt out in our new Mission Statement and ultimately achieve our Vision, we are galvanized by a set of new core values of Patriotism, Integrity and Professionalism.
Tell us about the Domestic Revenue Mobilization Strategy and how URA is setting up to promote it?
The core objective of the DRMS is to improve revenue collection and lift Uganda’s tax-to- GDP ratio to somewhere between 18-20% within five years of its implementation. The strategy targets to change the way revenue is raised by targeting the following:-
- Lifting the capacities of the revenue administration entities to ensure that revenue is raised in an economically efficient way that reduces the compliance burden for individuals and businesses.
- Enhancing transparency and accountability in the tax solution, making it harder for the few who would subvert our society to engage in dishonesty and fraud.
- Enhancing taxpayer service delivery, deepening taxpayer education and access to information to ensure that we are all on one path together.
The above three areas drive the strategic direction of URA. The DRMS further sets the pace for URA’s operations by focusing on key areas to tackle weaknesses across the entire compliance continuum which include the following: Accuracy of the tax register, timely and accurate filing, timely payment of taxes, timely processing of tax refunds, improvement of the effectiveness of Non-Tax Revenues and above all Data Management and optimization.
Speaking specifically about revenue collection, what strategies have you put in place to hit the target of Ugx 22.4 Trillion for this financial year?
First of all, we take note of the uphill task we have before us given the economic environment we are operating in. But we have to mobilise the required resources to enable government deliver of the required services. For the case of Domestic Revenue Mobilization, the following are some of the focus areas in this financial year;
- Expanding the taxpayer register is key in broadening the spectrum from which we have to collect the required taxes. Besides we also have to ensure the integrity of the register at all times.
- Utilizing the available data generated by both the internal and external systems is a key avenue from which information shall be generated for revenue purposes.
- Enforcing the use of the EFRIS and DTS solution is going to be a key area of focus as these are important tools that generate date for the organization for enhancing the compliance of taxpayers.
- We are also geared to increase our outreach in the in the Central Business district of Kampala and in areas like Luweero, Mubende and Kamuli. Where we are unable to reach, we shall make use of the Mobile Office/Bus in order to ensure that we bring services closer to both the potential and willing taxpayers.
- Special focus is going to be given to the collection of non-tax revenues for both MDAs and Local Governments.
Today September 15th 2021, URA will commemorate its anniversary with a Thanksgiving service, Why is it very important for the institution to give Thanks to God for this momentous occasion?
We must praise and thank the Lord for the journey of URA has been a leap to growth-fast and steady especially in the core mandate of assessing and collecting central revenue on behalf of the government of Uganda.
At infancy in 1991, URA’s collections were about UGX 180 billion with a tax to Gross Domestic Product (GDP) ratio of 6.83%. In the second decade of existence, we rose to Ugx 1.2 Trillion in collections in the financial year (FY) 2001/02 ascending concurrently with the Tax-to-GDP to 10.44%.
The continuous growth in revenue can be attributed to the introduction of new tax regimes to compliment collections throughout the 1990s. These include Value Added Tax in 1996 and Income tax in 1997.
In 2010/11, collections grew to UGX 5 trillion, an increment of about 400% from the start of the decade. This curve rose immensely to over UGX 19 trillion by the close of the FY 2020/21. This particular year registered remarkable performance having been marred by the COVID-19 pandemic.
In FY 2020/21, URA contributed 53% to the actual budget expenditure. The organization now envisions funding the national budget by 100%. This is reechoed in URA’s new vision of a transformational revenue service for Uganda’s economic independence.”
What is URA particularly grateful for?
We have plenty of accomplishments to thank the Lord for. Among them is Government’s trust in URA’s capacity to transparently collect and account for all revenues and this has led to the increment of the scope of revenues to be collected to include Appropriation in Aid (AIA) e.g. University fees.
We are also grateful for the ability to enhance taxpayer services, education, and access to information to improve the taxpayers’ understanding of taxation. We have become more outgoing i.e. more engaging with both the taxpayers and the stakeholders associated with her businesses.
We took a leap to harmonize taxpayer data with the introduction a unique identifier alias Taxpayer Identification Number in 1993. We have now fully automated processes thereby lessening turnaround time in responding to our taxpayers thanks to technology.
URA has ably positioned herself among her regional peers and has represented Uganda in the non-tariff programs to facilitate trade in a harmonized environment. Such abilities have earned URA trust on the African continent explaining why the launch of African Tax Administrators Forum (ATAF) in 2009 happened in Kampala. Today, URA is an influential member of a continental body spearheading solutions to African revenue challenges.
In the same year, the Authorized Economic Operator Program was adopted with 11 pioneer members. The program is aimed at rewarding top players in international trade whose compliance record is commendable. Currently, the program has 96 members whose trade operations amount to about to a tune of 2.89 Billion USD and accounting for about 26% of total tax revenue.
Innovations to ease customs clearing processes have been expanded to include priorities to facilitate trade and regional integration. This has been boosted by a number of initiatives employed such as: One Stop Border Posts (OSBPs) from 2016, implementation of the Single Customs Territory (SCT) in 2014, RECTS, Uganda Electronic Single Window (UeSW), AEO, and implementation of the non-intrusive inspection (NII) in 2018, etc.
RECTS offers cargo e-monitoring, thus reducing transit time by 50%.
The Uganda Electronic Single Window (UeSW) platform enables international traders and government to submit regulatory documents at a single location while the NII, in major boarder points of Busia, Malaba, Mutukula, and Entebbe, allows for inspection of cargo without the need to open the means of transport and unload the cargo.
In addition to the SCT reduced non-tariff barriers and enabled lodgment of declarations before cargo arrives at Mombasa, thus downsizing clearance time from 18-22 days in FY 2012/13 to 4-6 days currently. This move enhanced trade among EAC member states, with support of a Centralized Document Processing Centre (DPC).
The earlier initiatives have today been coupled with Electronic Fiscal Receipting and Invoicing Solution and the Digital Tracking Solution which are not only meant to ease record keeping but also aid in real time tracking of business operation from manufacturing or importing to the final consumer.
Tax education to targeted stakeholders through physical interactions, media engagements and outreach programs has been intensified. The launch of the URA Tujenge Uganda Mobile Tax Office in July 2021 is extending services to Ugandans in areas where URA may not have physical presence. Today, we have extended our services to all major business areas across the country. These efforts are all targeted towards increasing awareness, compliance and expansion of the taxpayer register.
In 2019, we moved into our 21- floor home at Nakawa housing all the Central Business District offices in one place. This saved the taxpayer UGX 3 billion in rent and other service connections annually. The tower provides backend service in one location thus easing service delivery.
Over the years, URA has been recognized by professional bodies and institutions for being a center of excellence in revenue service initiatives, legal services, Human resource management, ICT, public relations among others.
All these milestones are attributed to the resilient and committed efforts of the government, staff and our taxpayers but most importantly, to God.
Any message to taxpayers for the 30 years’ anniversary?
URA just started a new transformational journey at 30 years. At this new age, the taxpayer should expect a service so good that compliance will be simply an outcome. I therefore call upon every business person and every stakeholder engaged in Developing Uganda Together to embrace this journey and move along with URA to deliver our country towards economic independence.
