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Tax evasion and widening the tax base in Uganda

Author

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  • Sennoga, Edward B.
  • Matovu, John Mary
  • Twimukye, Evarist P.

Abstract

Uganda still lags behind in its tax collections at the domestic level. For most of the commodities the tax collection effort is not more than 5 percent relative to the statutory rate of 18 percent. This results into a situation where the government has to rely a lot on foreign financing. From the analysis, there is a lot of improvement where URA can be able to increase its tax effort. this could be achieved by targeting commodities that are under-taxed and excluding food items for equity purposes. Increasing domestic collection would also result into less over reliance on taxing a few commodities especially fuel which is interlinked with a lot of other sectors and could indeed harm growth in the long-run. We also find that the tax effort on imports is sufficient. However, import duties on fuel remain very high and this could be a symptom of the poor domestic tax collection.

Suggested Citation

  • Sennoga, Edward B. & Matovu, John Mary & Twimukye, Evarist P., 2009. "Tax evasion and widening the tax base in Uganda," Research Series 54802, Economic Policy Research Centre (EPRC).
    • Handle: RePEc:ags:eprcrs:54802
    DOI: 10.22004/ag.econ.54802
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    References listed on IDEAS

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    Cited by:

    1. Joseph Mawejje & Ibrahim Mike Okumu, 2016. "Tax Evasion and the Business Environment in Uganda," South African Journal of Economics, Economic Society of South Africa, vol. 84(3), pages 440-460, September.

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