KAMPALA – Uganda Revenue Authority (URA) has collected up to UGX15. 4 trillion in net revenue collections for the first three quarters of this FY 2021/22, against a target of 16.5 trillion.
The results are contained in a revenue performance report released on Tuesday, May 10, representing 69.16 percent of the annual target of UGX. 22.4 trillion.
“A significant growth in revenue of UGX 1,490.41 billion (10.66%) was registered in July to March FY 2021/22 compared to the same period in the FY 2020/21,” John Musinguzi, the URA Commissioner General told reporters.
Presenting revenue figures, URA Commissioner General John Musinguzi said that major surpluses were registered in PAYE (UGX 248.65 billion), casino tax (UGX 14.70 billion) and tax on bank interest (UGX 1.84 billion).
Shortfalls were mainly incurred in corporate tax (UGX 200.81 billion), withholding (UGX 142.35 billion), rental tax (UGX 120.29 billion), and treasury bills (UGX 45.14 billion) majorly due to COVID 19 restrictions that led to supply chain disruptions, low aggregate demand in the economy and thus reduced profitability.
PAYE contributed the most to direct domestic taxes collections registering a growth of 15.50%, followed by Corporation tax.
For the case of indirect tax, collections for the period July to March were UGX 3,602.86 billion. A growth of UGX 341.90 billion (10.48%) was realized compared to the same period in the FY 2020/21.
Other categories, the report indicates that VAT collections were UGX 2,394.10 billion registering a shortfall of UGX 504.72 billion and a performance of 82.59%. A growth of UGX 224.78 billion (10.36 percent) was realized.
The report further indicates that under performance was witnessed in the Construction sector by UGX 74.83 billion, Beer UGX 49.39 billion, spirits/waragi UGX 48.38, soft drinks UGX 43.72 billion and Real Estate activities UGX 43.13 billion but a major surplus in Phone talk time at UGX 43.63 billion was registered.
Top performing sectors
According to the three quarter revenue performance report for 2021/2022, about 74.48 per cent of the revenue was generated from the top five sectors of the economy, with the Wholesale and retail, Manufacturing, Financial activities, Information & communication and Public administration and defense generating the biggest share.
“Wholesale and retail trade sector was the highest contributor with 29.25 % (UGX 4,604.72 billion); Manufacturing sector followed with 23.45% (UGX 3,690.68 billion). The third sector in terms of revenue contribution was Financial activities excluding insurance with 9.90%(UGX 1,557.68 billion), then Information and Communication sector in the fourth with 7.83% (UGX 1,233.11 billion) and Public administration and defense in the fifth with 4.05%(UGX 637.32 billion),” the taxman said while releasing the revenue performance for the 2020/21 financial report.
Musinguzi also told reporters that majority of the sectors recorded positive growth throughout the nine months, but said significant declines in revenue were registered in some sectors including real estate, construction electricity, gas, steam and air conditioning. He attributed the decline is attributed to slow recovery of businesses from COVID19.
During the first three quarters of the FY 2021/22, the commissioner general said that URA has intensified administration measures to influence taxpayer compliance behavior, widen the tax base and support revenue collections.
Key among the initiatives implemented in the period July to March FY 2021/22 include, he listed the expansion of the taxpayer register, Arrears Management, Customs Enforcement and Tax Investigation compliance initiatives.
Results presented by Mr. Musinguzi indicated that tax investigation efforts alone resulted into the completion of 163 cases with recoverable revenue worth UGX 114.58 billion.
Other initiatives include Prosecution and Civil Litigation, Debt Collection Unit and EFRIS and DTS.
“As we race towards the end of this financial year in June 2022, we have to collect UGX5.9 Trillion and we are optimistic that we shall meet this target. I call upon all Ugandans to collaborate with us as we develop Uganda together,” Mr. Musinguzi said.