URA urged to write off sh9b debt
Feb 20, 2007
THE Uganda Revenue Authority should write off sh9b that local governments owe it in tax arrears, a commission has recommended.
By Apollo Mubiru
THE Uganda Revenue Authority should write off sh9b that local governments owe it in tax arrears, a commission has recommended.
The chairperson of the Local Government Finance Commission, Johnson Bitarabeho, yesterday revealed that they had communicated the resolution to the tax body and the Ministry of Finance.
The arrears accumulated from the districts’ failure to remit withholding tax, value added tax and pay as you earn to the revenue authority. Appearing before the parliamentary public service and local government committee, Bitarabeho asserted that the arrears had led to the freezing of districts’ accounts, hence paralysing their operations.
The Constitution mandates the commission to advise the President on matters concerning the distribution of revenue between the Central Government and local governments.
Citing an article run in The New Vision on Monday, Bitarabeho explained that the commission had received complaints from districts as the Uganda Revenue Authority (URA) enforces the recovery of tax arrears.
According to the story, the tax body withdrew all the money on Lira district’s account to recover value added tax arrears amounting to sh466m.
In Mubende, Bitarabeho revealed that the district property was attached on February 9, while the account of Masindi district was blocked in August last year.
He disclosed that Wakiso district also owes the tax body sh130m.
“This has caused breach of contract between local governments, the Government and donors, which may cause donors to withdraw from these projects as districts lose substantial funding.â€
The commission secretary, Lawrence Banyonya, attributed the failure by local governments to remit arrears to URA to the lack of adequate revenue following the abolition of graduated tax. He emphasised that the revenue collected was not enough to meet the expenses of a district.
Banyonya observed that the Government had never released the graduated tax compensation of sh45b, prompting the committee chaired by William Wopuwa (Bubulo East) to summon finance minister Dr. Ezra Suruma over the matter.
THE Uganda Revenue Authority should write off sh9b that local governments owe it in tax arrears, a commission has recommended.
The chairperson of the Local Government Finance Commission, Johnson Bitarabeho, yesterday revealed that they had communicated the resolution to the tax body and the Ministry of Finance.
The arrears accumulated from the districts’ failure to remit withholding tax, value added tax and pay as you earn to the revenue authority. Appearing before the parliamentary public service and local government committee, Bitarabeho asserted that the arrears had led to the freezing of districts’ accounts, hence paralysing their operations.
The Constitution mandates the commission to advise the President on matters concerning the distribution of revenue between the Central Government and local governments.
Citing an article run in The New Vision on Monday, Bitarabeho explained that the commission had received complaints from districts as the Uganda Revenue Authority (URA) enforces the recovery of tax arrears.
According to the story, the tax body withdrew all the money on Lira district’s account to recover value added tax arrears amounting to sh466m.
In Mubende, Bitarabeho revealed that the district property was attached on February 9, while the account of Masindi district was blocked in August last year.
He disclosed that Wakiso district also owes the tax body sh130m.
“This has caused breach of contract between local governments, the Government and donors, which may cause donors to withdraw from these projects as districts lose substantial funding.â€
The commission secretary, Lawrence Banyonya, attributed the failure by local governments to remit arrears to URA to the lack of adequate revenue following the abolition of graduated tax. He emphasised that the revenue collected was not enough to meet the expenses of a district.
Banyonya observed that the Government had never released the graduated tax compensation of sh45b, prompting the committee chaired by William Wopuwa (Bubulo East) to summon finance minister Dr. Ezra Suruma over the matter.