Uganda tax body struggles to hit targets

Tuesday January 11 2022
Uganda Revenue Authority.

Uganda Revenue Authority staff attending to URA clients during a Customer week in Kampala. PHOTO | MORGAN MBABAZI | NMG


With the half year revenue collection calendar already elapsed, the Uganda Revenue Authority (URA) is still behind in its domestic revenue collection targets of slightly more than $6.17 billion.

The ongoing Covid-19 pandemic has complicated the situation, and tax experts, economists and policy analysts now say there is no guarantee URA will hit its target by the end of the financial year in June.

By close of the 2020/21 financial year six months ago, URA had collected $5.39 billion in net revenue and posted a 14 percent growth in comparison to the previous period, an estimated tax to GDP ratio of 12.99 percent.

In real terms, this reflects a revenue growth of $702.14 million, although it missed the target by $645.9 million, the taxman said while releasing the revenue performance for the 2020/21 financial year and the outlook for 2021/22.

Top sectors

According to the half-year revenue performance report for 2021/2022, about 71 per cent of the revenue was generated from the top four sectors of the economy, with the wholesale and retail trade sector registering the biggest contribution of $1.6 billion (29.43 percent),.


The manufacturing sector followed with a contribution of $1.23 billion (22.7 percent). The information and communication sector contributed $561.7 million (10.48 percent), while $449.3 million (8.39 percent) was generated from the financial and insurance services sector.

However, some sectors witnessed major declines in revenue in the FY 2020/21, compared to 2019/20 on a slowdown in business from the Covid-19 pandemic. Revenue from accommodation and food services declined by 37 percent, education sector by 10 percent, arts entertainment and recreation by 31 percent.