Uganda Revenue Authority (URA) has collected Shs9.2trn in the last three quarters (9 months) of 2016/17 Financial Year (FY), a contribution of 70.11℅ to the annual target of 13.1trn.
However, the tax body registered a shortfall of Shs240bn in the same period, thanks to the bad economy.
Addressing the press on Wednesday May17, 2017 at URA headquarters in Nakawa, the URA Commissioner General, Doris Akol said economic slowdown is expected to adversely affect their revenue mobilisation efforts, adding that a shortfall of approximately Shs131.1bn is expected in the 2016/17.
“During period July 2016-March 2017, macro econ environment has noted a slowdown due to drought, constrained aggregate demand and global uncertainty,” Akol said.
She added: “This economic turbulence has affected the level of economic activities & revenue collections from the key performing sectors.”
There has been negative growth in the manufacturing, construction and real-estate sectors mainly due to slowed growth in credit to the private sector.
“Private sector credit reduced significantly yet the majority of the traders depend on credit to run businesses and pay taxes,” Akol said.
There was a decline in the manufacturing sector from 26.53℅ to 24.71℅ and in the financial sector from 10.66℅ to 9.16℅.
However, the tax body registered a growth in revenue of 13.51℅ compared to the same period in 2015/16 FY.
The leading contributor to revenue collections was wholesale and retail sector with 27.74 ℅, registering a 1℅ increase from FY 2015/2016.
Additionally, domestic revenue posted a surplus of Shs28.60bn over the nine months period, thanks to the tax body’s efforts to bring more people in the informal sector into the tax net.
Domestic Taxes have contributed 57.17℅ to the collections, while International Trade has contributed 42.84℅.
Going forward, Akol said they have tightened revenue leakage points and introduced new systems and procedures, thus enhancing revenue efficiency.
On Tuesday, The International Monetary Fund (IMF) said it expects Uganda’s economic growth to slow down to 3.5 to 4% in 2016/17 financial year, down from the earlier anticipated 5% due to drought and slow credit growth.
“The drought held back activity in the first part of the year. Private sector credit is an additional drag,” IMF said in a statement.
In 2017/18 National Budget, URA is expected to raise Shs14.5 trillion to support the Shs30 trillion budget.
