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TAX ADMINISTRATION, POVERTY AND INEQUALITY

TAX ADMINISTRATION, POVERTY AND INEQUALITY. Allen Kagina Commissioner General. Facts about Uganda. Population: 33 million Average annual population growth rate: 3.2%, one of the highest rates in the world. Average life expectancy: 53 years

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TAX ADMINISTRATION, POVERTY AND INEQUALITY

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  1. TAX ADMINISTRATION, POVERTY AND INEQUALITY Allen Kagina Commissioner General

  2. Facts about Uganda • Population: 33 million • Average annual population growth rate: 3.2%, one of the highest rates in the world. • Average life expectancy: 53 years • Percentage of people below the poverty line: 31%. • Tax/GDP ratio 13.1% (2010) • Revenue contribution to national budget 73% • Gini index 45.7 Sunday, December 4, 2011 3

  3. Challenges The isn't enough to around: why? • Narrow Tax Base • Large informal sector • Wide range of exemptions Therefore the dilemma of policy makers Income distribution and revenue mobilization competing with each other in policy decision? It depends on who you talk to when. Sunday, December 4, 2011 5

  4. Administrative Challenges Inadequate Budget Resources • To afford Modern and Advanced tools • To afford Up to date Skills • To retain and remunerate the best staff • To explore emerging business lines e.g • e-commerce (Forex trading, Cloud computing) That match the pace of business transformation (Positive and Negative) Sunday, December 4, 2011 4

  5. Policy Interventions Policy Initiatives to address inequality • Free primary, secondary and tertiary education • Subsidized medical care • Creation of a ministry for micro finance Sunday, December 4, 2011 6

  6. Policy Interventions TaxPolicy Initiatives to address inequality • A progressive personal income tax (PAYE) • Exemption of charitable organizations • Exemption of income of educational institutions • Exemption of health services • Exemption of the agricultural sector • Interest on agricultural loans exempted from tax The best tax policy in the world is worth little if it cannot be implemented effectively! Sunday, December 4, 2011 6

  7. Administrative Interventions. Tax Morale - willingness to comply with tax laws. • Major efforts for Voluntary Compliance. • Fully dedicated to Self Services • eRegistration, efiling, ePayments, Online Tracking • 24/7 services (Customs, Payments, Filing) • Zero Tolerance to Corruption • Rebranding (Offices, Signage, Fleet) • Mobile Tax hubs Sunday, December 4, 2011 7

  8. Interventions.. • Tax Education • Tax Curriculum in Secondary Schools • Tax sensitization • Corporate Social Responsibility • Business Fora • Taxpayer recognition and Appreciation Days Sunday, December 4, 2011 8

  9. Interventions... • Reforms • Capacity Building • Training • Benchmarking (Rwanda, Ghana, Namibia, TZ, SA, Israel, Kenya, Angola, Nigeria ....) • Phase I (2005 - 2010) • Alignment of Execution to Strategy (BSC Framework) • Business Process Re-engineering (DT and Customs) • Automation of Business Processes (eTAX ) Sunday, December 4, 2011 9

  10. Interventions.... • Phase II (2011 - 2016) • Service Support Enhancement • Building a robust taxpayer service function as well as service support capabilities • Infrastructure Development • Base ICT Infrastructure to support online services, One Stop Service Center for all services • Integrated Tax Administration • Fully Integrated Processes and Systems • Institutional Change Management Sunday, December 4, 2011 10

  11. Regional Cooperation • ATAF - south to south cooperation especially in capacity building. • Regional Information exchange mechanisms systems to stop evasion. Sunday, December 4, 2011 11

  12. Thank you for your attention Sunday, December 4, 2011 11

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