By Mulengera Reporters
The Uganda Revenue Authority (URA) has been assigned a tax collection target of UGX 33.182 trillion for the 2025/26 financial year—an increase of UGX 1.8 trillion from the UGX 31.369 trillion mandated for 2024/25.
The announcement was made by URA Commissioner General John Musinguzi while appearing before Parliament’s Finance Committee to present the Authority’s 2025/26 Budget Framework Paper. He cautioned that URA’s ability to meet this revenue target is threatened by a mass exodus of staff, taxpayers’ resistance to new technology, and escalating smuggling activities across Uganda’s porous borders.
“In line with the first Budget Call Circular, the total revenue projection is UGX 33.182 trillion—an increment of UGX 1.813 trillion compared to the current financial year’s target of UGX 31.369 trillion,” Musinguzi stated. “However, this figure is subject to revision as the planning and budgeting process progresses, and the final number will be confirmed by the Ministry of Finance.”
Revenue Target Subject to Change
Minister of State for Finance Henry Musasizi informed the Committee that URA’s tax target is not fixed and could be adjusted.
“The first Budget Call Circular is based on figures from the Medium-Term Expenditure Framework (MTEF), but as we incorporate your recommendations and refine the budget, these figures may change,” Musasizi explained. “The President has repeatedly expressed concerns about revenue collection, and we are committed to supporting URA in meeting its targets.”
Challenges Affecting Revenue Performance
Musinguzi outlined several obstacles that could hinder URA’s revenue collection efforts, including:
- Limited data sharing across government agencies, which affects tax enforcement.
- Rising smuggling activities along Uganda’s borders.
- A large informal sector that remains outside the tax net.
- Staff turnover due to efforts to combat corruption, which has resulted in the loss of experienced personnel.
- Resistance to change, particularly in adopting new technologies.Budget Cuts and Resource Constraints
Despite plans to expand its operations, URA faces a significant budget cut of UGX 108.15 billion in the 2025/26 financial year.
“For 2025/26, URA has been allocated UGX 624.404 billion—comprising UGX 299.356 billion for wages, UGX 284.260 billion for non-wage expenditure, and UGX 40.788 billion for development,” Musinguzi noted. “This is a reduction from UGX 732.554 billion in the current financial year.”
URA’s budget is projected to increase over the next five years, reaching UGX 988.928 billion by 2029/30.
URA Seeks Additional 1,500 Staff
To strengthen its workforce and address the staff exodus, URA has requested funding to recruit 1,500 new employees.
“The critical initiatives for 2025/26 include filling the new approved structure with an additional 1,500 staff, developing an oil and gas monitoring system, enhancing cyber security and disaster recovery infrastructure, and expanding the URA Tax Academy to improve staff training,” Musinguzi explained. “We are also investing in advanced technology, including Artificial Intelligence and Machine Learning, to enhance tax collection.”
Mid-Year Revenue Performance
Between June and December 2024, URA collected UGX 15.248 trillion, surpassing its target of UGX 14.926 trillion. During this period, 382,125 new taxpayers were registered, bringing the total tax register to 4,872,508—comprising 4,643,170 individuals and 229,338 non-individual entities.
Customs enforcement operations recovered UGX 48.19 billion through 10,809 seizures, while total tax arrears recoveries amounted to UGX 831.97 billion—UGX 814.24 billion from domestic taxes and UGX 17.72 billion from customs.
URA’s tax investigations concluded 96 cases, identifying UGX 45.01 billion in recoverable revenue, while legal efforts recovered UGX 508.02 billion, including UGX 262.58 billion through alternative dispute resolution and UGX 95.06 billion through litigation.
MPs Question URA’s Revenue Projections
Otuke County MP Paul Omara questioned why URA’s revenue target does not reflect the Authority’s past growth and the planned recruitment of 1,500 additional staff.
“If we provide you with more tools and personnel, and considering your past performance—where you exceeded 3% growth and even hit 8% last year—URA should be capable of collecting at least UGX 35 trillion or more,” Omara argued.
Sheema Municipality MP Dickson Kateshumbwa urged URA to conduct thorough research on tax policies before presenting them to Parliament in March 2025.
“We have faced challenges in the past three years, where tax amendments lacked research, leading to their rejection by Parliament,” Kateshumbwa noted. “URA must ensure that its proposals are well-researched to avoid another embarrassment when they are struck down in the House.”
As URA prepares to meet its ambitious revenue target, the Authority must navigate budget cuts, technological resistance, and staff attrition while improving tax compliance and enforcement. The coming months will be crucial in determining whether URA can overcome these challenges and achieve its collection goals-Parliament Watch. (For comments on this story, get back to us on 0705579994 [WhatsApp line], 0779411734 & 041 4674611 or email us at mulengeranews@gmail.com).
