In the FY 2020/21, Uganda Revenue Authority (URA) collected net revenue of sh19.26Trillion and posted a growth in revenue of 14.99 percent in comparison to the FY 2019/20 and an estimated tax to GDP ratio of 12.99 percent, according to the agency’s Commissioner General John Musinguzi.
He said this during the press conference on revenue collections for FY 2020/21 and tax projections for FY 2021/22.
According to him, this reflects a growth in revenue of sh2. 5Trillion.
“New tax administration measures announced through the budget speech of FY20/21 that included EFRIS, DTS, scanners, debt recovery, use of GPS & data analysis, yielded revenue of sh1,111.01bn against a target of sh548.00bn, performing at 202.74%,” said Musinguzi.
According to him, EFRIS, the new smart business solution used to record business transactions and share the information with URA in real time contributed to the 14.73% growth in VAT collections.
“The manufacturing sector had a tax contribution of sh4, 4Trillion. The sector’s tax contribution grew by 27.52%. The domestic revenue and customs revenue in the FY 2020/21 grew by 13.71% and 16.43% respectively. “
Revenue from different sectors
Musinguzi said the information and communication sector had a tax con of sh2.05Trillion. The sector’s tax contribution grew by 25.73%. The wholesale and retail trade sector had the biggest tax contribution of sh5.7Trillion. The sector’s tax contribution grew by 19.13%.
“The financial and insurance services sector had a tax contribution of sh1.6Trillion. The sector’s tax contribution grew by 5.55%. In real terms, this reflects a growth in revenue of sh2.5Trillionand a growth in the Tax to GDP ratio by 1%. This is the highest growth registered in the last four years.”
‘COVID 19 affected revenue growth’
The Commissioner General said that was the revenue target approved by Parliament before the impact of Covid-19 set in and macroeconomic variables that affect revenue such as GDP growth were projected at 6% yet by the end of the FY2020/21 GDP growth was at 3%.
It should however be noted that, the outturn of the FY 2020/21 is short of the target of sh21.6Trillion by sh2.37Trillion
“It is our target to increase the tax register by at least 500,000 tax payers every financial year. In regards to the EAC region, URA had the highest year-on-year revenue growth (14.99%). Tanzania collection in FY 2020/21 was less than that collected in FY 2019/20 by 0.1%.
PAYE was one of the major tax heads affected by the adverse impact of COVID 19 leading to a shortfall of sh315.51 billion.
On litigation, Musinguzi said a total of over 259 cases were filed of which 231 were civil and 28 criminal cases. During the financial year 2020/21, 65 cases were ruled in favor of URA while 20 were in favor of the taxpayers.
“In this press conference, we will focus on the revenue performance for FY 2020/21, the factors behind the performance and the outlook for FY 2021/22, the year when we will be celebrating 30 years of existence as Uganda Revenue Authority (URA).”