This archive report was first published on 9 December 2019.
Uganda's revenue woes have led to a loan request of Ush2.4 trillion ($664.7 million) to finance the public security sector and cover shortfalls in revenue collection.
The loan request, pending approval in parliament, will see half of the amount borrowed from Stanbic Bank and the rest from the Trade and Development Bank.
According to the Uganda Revenue Authority, a shortfall of Ush603.7 billion ($162 million) was registered in the first quarter of the 2019/2020 financial year, with a total revenue shortfall of Ush1.9 trillion ($510.2 million) expected by the end of the financial year.
The target of collecting Ush6.1 trillion ($1.6 billion) by October was missed due to delays in implementing administrative measures, including the installation of a digital tax stamp system to prevent tax evasion.
However, the private sector has raised concerns over the lack of consultation on the installation of digital tax stamp machines, which they fear may increase the cost of doing business in Uganda.
“URA has not consulted the private sector on where to install the digital stamp machines. Yet if the digital machines interface and affect insured machines in the factory, the government isn’t willing to take on the cost,” said Gideon Badagawa, executive director of the Private Sector Foundation.
