Kenya, Uganda fail on revenue targets

High collections targets. Rwanda and Tanzania recorded high collection targets of 101 and 100 per cent respectively.

Regional tax authorities are struggling to hit revenue targets due to poor performance of international tax collections. According to Uganda Revenue Authority, regional performance for July and December 2012 was below expected targets for East African economies apart from Rwanda and Tanzania.

“Revenue authorities in the EAC performed below target except Rwanda Revenue Authority and Tanzania Revenue Authority whose overall performance was 101 per cent and 100 per cent respectively,” Ms Sarah Birungi Banage, the URA commissioner for public and corporate affairs said last week at the release of URA’s revenue performance report.

She added: “Kenya Revenue Authority registered a 90 per cent performance in gross revenue mobilisation while URA registered 95 per cent performance.”

However, all the regional authorities posted growth in gross revenue collection compared to the same time last year (between July - December 2011)

Data shows that TRA posted the highest growth of 23 per cent followed by RRA with 16 per cent, and URA 15 per cent. KRA posted growth of 12 per cent.

“TRA registered above target performances in domestic revenue mobilisation with a performance of 101 per cent and 103 per cent respectively.

RRA posted a performance of 97 per cent while KRA posted a performance 92 per cent,” reads URA performance report.
Meanwhile RRA also registered 109 per cent in international trade, the best performance in the region TRA at 95 per cent and URA registering 88 per cent while KRA performed at 88 per cent.
However, there was a general slump across the board in international trade taxes in all the four EAC countries apart from RRA whose performance was above target.

Mr Geofrey Akena, a tax analyst told Prosper that regional revenue performance tells a story of EAC economic performance.
He said: “Most of EAC economies are recuperating from economic shocks, so not until they get back to their feet collections are likely to be low.”

Mr Akena who is the executive director, East African School of Taxation, said the Shs175 billion revenue shortfall, with six months to close the financial year, may not be recovered given the time constraint Uganda Revenue Authority faces.

In an earlier interview, the commissioner for customs, Richard Kamajugo, said the region was only recovering from global and internal volatilities.

He said: “With the economic crisis in Europe (Euro zone crisis) the EAC was bound feel the after effects considering that it is one of Uganda’s major trading partner.”

He continued: “But this is temporary because as the EU recovers from the crisis things will get better.”

iladu@ug.nationmedia.com