National ID: More Ugandans to be taxed
Aug 21, 2014
THE ongoing registration exercise for national identity cards will provide accurate information needed to identify Ugandans who are eligible to pay taxes
By Pascal Kwesiga
THE ongoing registration exercise for national identity cards will provide accurate information needed to identify Ugandans who are eligible to pay taxes, an official from finance ministry has said.
According to statistics from the finance ministry, an estimated 80% of Ugandans who are eligible to pay taxes are not taxed due to lack of reliable information about them and their businesses.
Francis Twinamatsiko, the head of the Oil and Gas taxation division in the finance ministry has said more Ugandans who are not taxed will be identified when the national identify card registration exercise has been completed.
As a result of inadequate information on businesses that ought to be taxed, Twinamatsiko said, Uganda taxes only 13% of the country’s Gross Domestic Product (GDP) because of poor tax administration. He explained that Uganda’s GDP (income) was sh60,000 trillion in the last financial year.
“You can imagine only 13% of that income is taxed. If this income was being taxed we would not be borrowing because this would fetch a lot of money,” Twinamatsiko added. This means 87% of GDP is not taxed.
He was speaking during a recent annual accountability sector review conference in Kampala.
He noted that 13% of GDP which the tax authorities have been taxing for almost ten years in Uganda is the lowest in the region. According to him, 14.5% of GDP is taxed in Rwanda, 16.5% in Tanzania, 23% in Kenya.
The 13% tax GDP ratio, Twinamatsiko said funds 70% of the national budget. According to 2014/2015 budget, the government is expected to fund 82% of the sh14trillion budget. The 18% of the funding will be provided by the development partners.
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