URA continues to post deficits

Trend of deficits. URA has in the last three months been registering collection deficits.

The dismal performance in international trade tax collections continued to eat into revenue targets, according to data released by the Uganda Revenue Authority.

Data indicates that the tax body registered a collection deficit of Shs21 billion as a result of accumulated demurrages caused by the cash bond standoff, unstable exchange rates and shortage of sugar imports for the month of October.

“These are really hard times. None of the EAC member states has hits its international trade target,” said the Uganda Revenue Authority (URA) Assistant commissioner for corporate affairs, Ms Sarah Banage Birungi.
According to Ms Banage, URA collections for October stood at Shs516 billion against a target of Shs537 billion.
This was mainly brought about by a deficit in international trade taxes, which stood at Shs19 billion.

On a cumulative basis, net revenue collections for the period July – October 2012 stood at Shs2 trillion against a target of Shs2.1 trillion, registering a deficit of Shs91 billion.

However, the October performance and the cumulative targets, although below the anticipated revenue collections, have impressively grown compared to the same period last year.

Domestic taxes, have staggered a little with a Shs2 billion deficit in the month of October.

Other reasons for the shortfall include the volatile exchange rate, which by close of yesterday had fallen to Shs2,700. This, according to URA, led to loss in revenue of about loss of Shs6 billion.

URA also said tax collections had also been affected by the cash bond standoff between Ugandan traders and the Kenya Revenue Authority.
iladu@ug.nationmedia.com