Government tax revenue collections in October 2017 only hit Shs1045.7 billion, posting a shortfall of Shs102.3 billion from the monthly projection of Shs1, 148.0 billion, the latest monthly performance of the economy report says.
But the report released by the Ministry of Finance shows a growth of 18 percent in tax collections when compared to the same month a year ago. The report attributes the increase mainly to the newly introduced policy measures in the current financial year such as making the Uganda Revenue Authority (URA) as the sole recipient of taxes.
According to the report, direct domestic tax collections amounted to Shs281.6 billion, showing a performance rate of 85 per cent against the target. “This performance is explained by shortfalls in collections on withholding tax (19.3 per cent), tax on bank interest (17.6 per cent) and corporate tax (6.2 per cent),” says the report published this week.
Indirect tax collections amounted to Shs242.4 billion, recording a performance rate of 81 per cent against the target. The report attributes the 81 per cent performance to shortfalls on VAT collections in the manufacturing sector as there were lower sales of soft drinks and cement. “There were also lower VAT collections in the services sector … due to increased use of internet services over phone calls,” adds the report.
Meanwhile Tax collections from international trade amounted to Shs521.1 billion, recording a performance rate of 102 percent against the target. “This performance is on account of higher collections of VAT on imports (17.3 per cent), import duty (8.9 per cent) and surcharge on imports (3.4 per cent),” says the report.
The total non-tax revenue in the month amounted to Shs35.0 billion against the target of Shs28.5 billion, representing a surplus of Shs6.5 billion. The report attributes the higher performance to efficiency in collections as a result of the transfer of the collection responsibility of most the tax revenues to Uganda Revenue Authority.
During the month, total revenues and grants amounted to Shs1, 219.3 billion against the target of Shs1, 373.2 billion resulting in a shortfall of Shs153.9 billion. The report says the shortfall was on account of lower tax revenue collections and less than projected disbursement of grants.
Of the total outturn in October 2017, domestic revenues (tax and non -tax) constituted Shs1, 080.7 billion while grants represented Shs138.6billion. However, in comparison with October 2016, revenue and grants collections grew by 26 per cent.
Gov’t makes revenue shortfall of Shs102.3bn in October
