The Ugandan Government in a recent budget defence informed the public of its plan to implement stricter measures on existing taxes rather than introducing new ones for the 2022/23 financial year.
Taxpayers in Uganda can now relax their nerves as the government debunks the claim of any intention to increase tax for the 2022/ 2023 financial year. This recent rebuttal is coming from its minister of Finance, Matia Kasaijja.
In Kasaijja’s statement, the focus of the government is currently tilted toward helping Ugandans cope with the already harsh economic environment posed by the increasing inflation rates, ensuring that the tax burden is fair enough to allow them to meet up with the demands of essential commodities.
Rather than tax increment, the government has reiterated that it will now double its efforts in the implementation of existing taxes to ensure that returns from them are substantial to take care of the nation’s needs.
The budgetary allocation for the financial year under view is put at shs48 trillion and will focus on enhancing domestic revenue mobilization and reinforcement of extant tax laws for adequate revenue generation.
As part of measures to improve revenue collection from existing taxes, the government will now clamp down on tax evaders by blotting loopholes existing within the system.
Dwelling on measures to improve tax collection, the government in recent times had made amendments to various tax laws to make tax payment more seamless with clarity ensured on ambiguous and not easy-to-understand provisions. Amendments made so far span the Income Tax Act, Value Added Tax, the Stamp Duty Act and the Tax Procedures Act.
Beyond taxation coming to the rescue of the budget, The government had summarized that the fiscal plan will now aim at stimulating economic recovery, enhancing productivity alongside competitiveness of enterprises and also help in wealth creation and jobs for the ordinary Ugandans.
To this, Minister Kasaija said the government will work on ways of reducing its expenditure in the next financial year in a bid to realize the budgetary goals.
Below is the recent submission of the Ministry of Finance to the Ugandan Parliament
“Madam Speaker, no new taxes will be introduced in the financial year 2022/23. We will achieve revenue targets by improving the efficiency in tax collection and enhancing compliance with tax laws. The capacity of the Uganda Revenue Authority will be enhanced by recruiting and training staff, deploying appropriate equipment and ICT to enforce tax laws,”
“I wish to report that Parliament has made amendments to the various tax laws intended to simplify the laws, clarify previously ambiguous provisions and close loopholes that may lead to revenue leakage. 99. Madam Speaker, the amendments that have been made are in the Income Tax Act, Value Added Tax, the Stamp Duty Act and the Tax Procedures Act.”
“The amendments under the Tax Procedures Code Act among others include the introduction of penalties for failure to adhere to Electronic Fiscal Receipting and Invoicing Solution and Digital Tax Stamps. This is intended to combat tax evasion, smuggling, and other vices.”
Measures to Reach Collection Target
To meet up with the revenue-generation drive captured by the budget, the country is set to begin the collection of Value Added Tax, VAT from tech giants like Facebook, Netflix, Amazon, Uber.
The collection is slated to start by July 1st through established mechanisms by Uganda Revenue Authority (URA) to collect VAT from non-resident service provider companies operating in the Ugandan economy, including Facebook.
