URA Collects Shs 970b Taxes in April Amid COVID Lockdown

Despite the fact that COVID 19 lockdown has ravaged a number of sectors of the economy, Uganda Revenue Authority (URA) collected Shs 970b in April 2020, according to the agency’s Commissioner Domestic Taxes Dickson Kateshumbwa.

He attributed this to increased tax compliance by the taxpayers despite being under lockdown.

“I want to appreciate taxpayers because last month, we collected a total of Shs 970b in taxes yet it was an entire month of lockdown,” said Kateshumbwa.

URA usually collects between Shs 1.3 tn to Shs 1.4 tn in monthly tax revenue collections.

He said this during a high-level Pre-Budget Dialogue for FY 2020/21 that took place at the Ministry of Finance offices on May 28, 2020.

According to him, a number of businesses such as schools and hotels have been severely affected by COVID-19 lockdown but other sectors are performing relatively well.

“Of course, many sectors have been affected by COVID 19, but all we can say is that there has been increased compliance by taxpayers caused by trust in the systems as a major factor,” said Kateshumbwa.

What does a sh970b collection amidst lockdown signify?

Julius Mukunda, the Executive Director Civil Society Budget Advocacy Group (CSBAG) said the ‘fairer’ Shs 970 tax collection in April, 2020 signifies the resilience of Uganda’s economy, and optimism that even after COVID-19 situation, the economy wasn’t as devastated as expected.

“We are a strong country; strong people and I think we will get out of this. It doesn’t mean that we do not have challenges but given a good environment, we can do better,” he stated.

Mukunda expressed optimism about the economy’s performance

Dr. Arthur Bainomugisha, the Executive Director Advocates Coalition for Development and Environment (ACODE) noted that the ‘fairer’ collections amidst COVID-19 lockdown indicates that there was a lot of compliance and goodwill on the part of the taxpayers.

“I think Government has handled this COVID 19 very well. It has created goodwill from the people. Now taxpayers feel rallying around the flag for the cause. If URA can change its methods and intensify tax education to create goodwill and trust among the taxpayers, it is possible tax collections and tax base can increase,” he said.

Gov’t priorities in addressing COVID 19 economic impacts

Keith Muhakanizi, the Finance Ministry Permanent Secretary and Secretary to Treasury, said there are a number of areas that Government is going to look into to boost economic recovery.

He cited  import substitution through supporting industrialization and agro-processing.

“We are also prioritizing payment of domestic arrears so that we can put money in the economy. The demand is down, when we put money into industries, they cannot produce goods unless the population is consuming them and that’s very important,” said Muhakanizi.

“We are also looking at negotiating with donors and micro credit facilities so that we can support the poor to get cheaper credit. We are looking at supporting production and productivity in agriculture through distribution of inputs,” he stated.

‘Have special package for women’

Enock Mugabi, Programme Specialist Women’s Economic Empowerment at UN Women Uganda, urged Government to focus on gender and equity in the public procurement.

He said  if the Government leaves women to participate in competitive procurement, most of them will always lose out in Government deals like it is currently.

Mugabi cited Kenya, which has pushed affirmative action for women to benefit from procurement deals.

“We can also do gender and equity responsive procurement; Kenya has done it at thirty percent of procurement going to Women. If Women go through the competitive procurement, they may lose out,” he stated.