KAMPALA – The Ministry of Finance on Monday released UGX5 trillion for the second quarter of the financial year but warned that the government may have to borrow to facilitate the budget of the current financial year due to low revenue collections.
The Permanent Secretary/Secretary to the Treasury, Mr Keith Muhakanizi, while announcing the release of the UGX5 trillion for the October- December period, said while they projected to collect UGX20.449 trillion, so far they have a shortfall of UGX603 billion.
He said they had projected to collect net revenue of Shs6 trillion for the July-October period, but they only collected Shs5.6 trillion.
“There was a problem of wrong projection in revenue. It had been projected that domestic revenue should increase by 1.2 percent, but we were able to raise only 0.5 percent,” Mr Muhakanizi said, attributing the challenge to delayed implementation of the new tax measures.
He said this was because the initiatives they had planned to help in increasing revenues like digital stamps have taken long to start. The implementation of digital stamps starts fully in January 2020. Also, Muhakanizi said that the government was expecting money from MTN Uganda new license but the negotiations are taking long – all this means the government is getting less money than it had planned to spend.
Of the UGX5 trillion released for Quarter Two, UGX1.18 trillion goes to the wage bill, UGX842 billion to local government, Domestic arrears UGX400 billion, Uganda National Roads Authority UGX438 billion, and Electoral Commission Shs229.3 billion, among others.
He warned accounting officers against the accumulation of arrears and what he called mischarge revealing that most top and strong government departments tend to divert the money for weaker departments asserting that each department should exactly get what they have asked for.
“Mischarges are no longer acceptable. Accountant Generals’ Office is under instruction to reject such payments. In the next financial year, MDAs must, therefore, budget on correct items,” Mr Muhakanizi said.