PARLIAMENT | TAXES | URA 

Parliament recently passed a shs48.1 trillion Budget for the Financial Year 2022/2023 as the country grapples with the post-COVID-19 pandemic and the Annual Headline Inflation hitting 6.3% in May from 4.9% in April 2022.

The Budget which will be financed through the Uganda Revenue Authority (URA)’s collections (shs25.7 trillion), grants (shs2.1 trillion) and domestic borrowing (shs7.1 trillion) is a headache according to some experts.

Dr. Fred Muhumuza, a Makerere University Lecturer and Development Policy expert says that to achieve that, URA should look at improving efficiency, increasing the catchment areas and also limit room for people failing to pay.

Speaking at the inaugural BDO-Signum Tax Breakfast meeting at Golden Tulip in Kampala recently, Muhumuza said that, the annual budget estimates are not consistent with the Charter for Fiscal Responsibility (CFR) regarding nominal debt to GDP and debt.

 “The budget is not speaking with the economy; we are not putting money where it is necessary. We want to see President Museveni launch a war on his policies. We are recreating the things we stopped 30 years ago,” he said

He advised that as a country we should adopt new ways of doing business and build synergies between the poor and non-poor.

“Shift from physical office to online presence such as submission of documents and online meetings. Adapting new and convenient ways of payment through online payment platforms."

He advised the public to utilize opportunities to comply with their tax obligations through the voluntary disclosure programs, extension of deadlines to file returns, instalment payments and extension to pay.    

According to Jon Jet Tushabe, the director Tax at BDO East Africa, taxpayers will have to make changes to their business strategies and models to comply with Uganda Revenue Authority (URA).

“The cost of non-compliance has been made very consequential. For example, for making misleading statements, the fines have been increased from Ush4million to a whopping Ush110 million,” he said.

Tushabe pointed out that there has been an increment in the rental income tax from 7.5% to 12% on the gross. Parliament has placed the threshold for payment of tax at dh2.8m.

However, Sarah Chelangat the Commissioner Domestic Tax said that the authority is addressing key tax administrative changes to support revenue collection and ease tax compliance.

She said that URA is doing sensitization through tax education to ensure that even illiterate Landlords can pay taxes using mobile money. Tax is going through a very fast digital revolution.