Uganda’s domestic revenue makes shortfall in November – report

By George Mangula

Domestic Revenues collections in Uganda during the month totalled to Shs 1,429.20 billion (88.0 percent) against the programmed Shs 1,624.93 billion, according to the Performance of the Economy Report for December.

The report released by the Ministry of Finance attributes the shortfall in domestic revenue to the underperformance in the major aggregates of revenue that show both tax and Non-tax revenue registering shortfalls of Shs189.46 billion and Shs 26.69 billion respectively.

According to the report, all tax heads registered shortfalls in the month of November 2019. Direct domestic taxes were Shs79.26 billion (or 17.7 percent) short of the targeted Shs 449.08 billion as Pay As You Earn (PAYE) and withholding tax, two of the largest categories performed poorly during the month.

Similarly, indirect domestic taxes also performed below the target for the month, registering a shortfall of Shs62.17 billion (or 15.4 percent). Both VAT and excise duty fell short of their targets for the month.

Taxes on international trade were affected by lower than projected import demand during the month. Collections amounted to a shortfall of Shs 48.78 billion (or 7.4 percent) with both import duty and VAT on imports falling short by 12.8 percent and 11.9 percent respectively.

The report shows that expenditure and net lending for November 2019 amounted to Shs 1,822.02 billion representing a performance of 65.7 percent against the target for the month. Expenditure on recurrent items performed at 89.7 percent on account of a downward adjustment in non-wage recurrent as well as payment of domestic interest.

“Payment of wages and salaries was slightly higher than had been planned for November 2019. This was because some payments that were due in October were effected in November,” the report adds.

Development expenditure was only 48.7 percent of the planned expenditure for November 2019 as both domestically financed and externally financed expenditures were lower than what had been planned for the month, the report says.