Kampala | RedPepper Digital – President Yoweri Kaguta Museveni on Wednesday had no kind words for Uganda Revenue Authority as regards to slow tax to gross domestic product (GDP) ratio which currently stands at 14%.
The President says this has made the borrowing syndrome to finance the country’s ever-swelling national budget (UGX42trn for FY21/22) which doesn’t tally with revenue collected by the Commission (UGX19t) being the highest ever collected by the Authority in its 30 years of existence under the theme “Ebenezer, Thus far the Lord has helped us”(1samuel7:12)
“The story of the URA has quite a bit of Judases and some grasshoppers, they are all there. Jesus was quite lucky though he also struggled because originally, his disciples were 72, I see some of you have forgotten but he managed to reduce them to 12,” he made these remarks on Wednesday at Kololo independence grounds as the URA celebrated 30 years of existence since her formation in September 1991.
Museveni also gave a brief of Uganda’s tax to GDP ratio in relation to the slow economic growth as he said: “The size of the GDP of the economy shows the level of economic growth and we didn’t know this. That is why they say URA was formed in 1991. When we came from the bush there are people who had guided the ministry of finance like Kahooza, Joseph Okune, Prof. Mulema and I appointed Prof. Mulema as minister of finance and they were busy fighting and all that.”
He also added that upon realizing the rot in revenue collection they made some inquiries: “But after some time… we inquired, what is the problem, why don’t you have enough money? You that Holland has tax to GDP ratio of 40%, other European countries 30% other African countries 16%.”
The president also stressed that the country’s tax to GDP ratio in 1984 was 4% and owed a small number to corruption by the officials who were in charge of collecting revenue especially in the customs department in the country.
The president also noted that URA was created to wipe out the wanton corruption in the country which led to a slight improvement in the tax to GDP ratio. “That time the tax collection jumped to 11% of GDP from 4% and it has stagnated their all this time, what is the problem? Yes, I got some Josephs but quite a lot of Judases,” he said.
However, the president said that despite the bad eggs that were there at the time of the formation of the Authority, the current team has performed slightly better.
The president also cautioned the Authority on arrogance and reluctance to heed advice from experts. These he said in relation to the lack of counter-measure put in place at entry points of the country to curb losses in the customs department and rallied them to embrace technology to avoid losses in the customs department.
When asked how many x-ray machines for scanning of goods does the country have, Commissioner Customs Abel Kagumire said that there are currently 6 installed at Busia, Malaba, Mirama hills, Mutukula and one in Elegu four of which were installed in 2006 during the helm of Allen Kagina.
Very many years ago I started telling these people that there were a lot of miss-declarations because you have got a lorry 40 tonnes how do you know what is inside there? During the time of Allen Kagina. We even got an expert who told us that we were losing a lot of money because we couldn’t tell what was inside these Lorries,” he said.
Kagumire said that 39 more x-ray scanners are going to be imported from China to boost the fight against the under-declaration of goods at the country’s various entry points.
The tax to GDP ratio in sub-Saharan Africa is 16% with the highest on the continent being South Africa with 26%, while in Europe most nations are in the range of 30-40%. The president also directed the authority to fast-track the implementation of the 30% tax on commercial buildings in the country as per the 2020 amended rental income tax Act.
Speaking to journalists on the sideline of the function, the Commissioner-General Musinguzi noted that to fight corruption at the Authority, they have an informer whistle-blowing policy as he added: “Corruption will not be tolerated URA and we have already started.
Help us as members of the public share with us information; tell us the corrupt one and we will deal with them decisively because corruption is something that is hampering our country from going forward.
The function was graced by religious leaders from the Pentecostal, Anglican Church, and the Muslim. The main sermon was given by Rt. Reverend Nathan Ahimbisibwe; the Bishop of the diocese of South Ankole who urged the staff at the Authority to be like the biblical Joseph who interpreted the Pharaoh’s dream in regards to the seven years of abundance and seven years of poverty, and to translate it into mobilizing enough revenue for the economy and desist from being unfaithful like the Judas Iscariot who was a thief and betrayed his master.
All the religious leaders reechoed the call for a stern fight against the vice of corruption among public servants in the country.