The Minister of Finance, Planning and Economic Development, Henry Ariganyira Musasizi has called for stronger domestic revenue mobilisation and improved accountability in public spending to enable Uganda to finance its development without over-relying on borrowing and external support.
In his keynote address during the Uganda Revenue Authority (URA) engagement with Committees of Parliament, held under the theme “Domestic Revenue Mobilisation for Uganda’s Economic Independence and Fiscal Self-Reliance,” at Serena hotel in Kampala on Tuesday, Minister Musasizi said Uganda’s ambition to transform its economy must be matched by an equally ambitious effort to raise revenue locally.
He said the country cannot sustainably build a $500 billion economy, as envisaged under the government’s Tenfold Growth Strategy, on borrowed resources or development assistance.
“Ultimately, Ugandans must increasingly finance Uganda’s development through their own economic activity,” Minister Musasizi said.
He said the government’s growth strategy will focus on agro-industrialisation, tourism development, minerals, including oil and gas, and science, technology and innovation, including ICT and the creative industry.
Minister Musasizi said achieving the targets will require substantial investment in infrastructure, energy, education, healthcare, water, security and industrial development, among other sectors.
He challenged Parliament and URA to work together to close revenue leakages caused by non-compliance, under-declaration, smuggling, undervaluation and aggressive tax avoidance.
“Before asking compliant taxpayers to pay more, we must first ask: Is everyone who should be paying actually paying?” he said.
The minister said URA should strengthen the use of intelligence, sector analysis, third-party information, risk profiling and government data to identify taxpayers who are not meeting their obligations.
He said the objective should be to make compliance easier while making tax evasion increasingly difficult.
Minister Musasizi also called for the formalisation of Uganda’s informal sector, saying small businesses that are supported to grow can become stronger taxpayers and employers.
He urged URA to combine registration, taxpayer education, simplified compliance, technology and appropriate enforcement, rather than treating all non-compliant businesses in the same manner.
“The taxpayer is not the enemy,” he said, urging the tax body to distinguish between deliberate tax evasion and businesses that need support to understand their tax obligations.
Technology
The minister said technology and data integration should play a greater role in modernising Uganda’s tax administration.
He said information held by URA, the National Identification and Registration Authority (NIRA), Uganda Registration Services Bureau (URSB), local governments and other institutions should, within legal and data-protection safeguards, be used to identify economic activity, verify declarations and improve compliance.
He cited systems such as the Electronic Fiscal Receipting and Invoicing Solution (EFRIS) and digital tax stamps as important tools for improving traceability and reducing revenue leakages.
“Digitalisation should reduce unnecessary physical interaction between taxpayers and tax officers, lower compliance costs, improve traceability and reduce opportunities for revenue leakage and corruption,” Minister Musasizi said.
Parliament’s role
Minister Musasizi said Parliament has a central role in strengthening domestic revenue mobilisation through its mandate to enact tax laws, consider revenue measures and tax exemptions, approve the national budget, scrutinise government borrowing and oversee the use of public resources.
He urged MPs to support efforts to broaden the tax base instead of repeatedly increasing the burden on existing compliant taxpayers.
He also called for greater scrutiny of tax exemptions and concessions, saying Parliament should consider the revenue foregone, the expected economic benefits, the duration of incentives and how their effectiveness will be assessed.
Minister Musasizi further asked Parliament to strengthen accountability by holding URA responsible for improved revenue performance while ensuring that government institutions account for the resources they receive.
He said revenue mobilisation must go hand in hand with prudent use of public funds.
“We cannot keep asking citizens to contribute more to government without showing that the resources already collected are used efficiently,” he said.
The minister said waste, inefficiency and misuse of public resources increase pressure on taxpayers and undermine public confidence in the tax system.
He called for a stronger fiscal compact in which government collects revenue fairly, URA administers the tax system professionally, Parliament provides effective oversight, public institutions account for public resources and eligible taxpayers meet their obligations.
Minister Musasizi also urged MPs to promote a culture of tax compliance in their constituencies, saying payment of taxes should be understood as a contribution towards financing Uganda’s development.
He said stronger domestic revenue mobilisation remains central to Uganda’s pursuit of fiscal self-reliance and long-term economic independence.
