Uganda ranked number 84 in global tax paying report

Kampala.

Uganda is number 84 in global ranking of Paying Tax 2018, a report by the World Bank and PricewaterhouseCoopers (PwC) says.
The report released on November 21 reveals that Uganda’s overall ranking amongst 190 economies has slightly declined from position 80 in 2015 (adjusted) to 84.
In East Africa, the report places Uganda second behind Rwanda (ranked 31).
The rankings for other East African countries show that Kenya has been ranked 92, Tanzania 164, Burundi 138 and South Sudan 68.
The World Bank and PWC Paying Taxes 2018 for Uganda says a model company had a Total Tax and Contribution Rate (TTCR, as defined under the Doing Business methodology) of 33.7 per cent for 2016, which is the same as the 2015 (adjusted) rate.
The model company makes 31 tax payments per year and takes 195 hours to comply with its tax requirements, numbers which have remained unchanged from 2015.
“The comparable average figures for the 53 surveyed economies in the African region are 46.8 per cent, 285 hours and 35.4 payments respectively, indicating that Uganda is doing comparably well in the region,” says the report.
In an interview with Daily Monitor on November 22, the associate director in tax at PwC Uganda, Mr Richard Marshall, said Uganda’s ranking is a reflection of the four sub-indicators for Uganda namely Total Tax and Contribution Rate, hours to complete, number of tax payments and post-filing index, relative to the other 190 countries.
“The sub-indicators provide an objective like-for-like basis by which the relative tax compliance burden in different countries can be evaluated and compared,” he said.
He added: “The ranking of 84 indicates that Uganda fares fairly well in the Africa continent, while globally it sits around the mid-point.”
Mr Marshall explained that the sub-indicators where Uganda performs well are in the hours to complete (that is the annual time required for a business taxpayer to complete the main tax compliance obligations – 195 hours compared to the global average of 240).
The report also shows a tax and contribution rate of 33.7 per cent versus the global average of 40.5 per cent.
“The hours to complete have been significantly reduced over recent years, largely due to the electronic filing and payment platforms introduced by the Uganda Revenue Authority,” he said.
Mr Marshall said these platforms have automated and standardised the compliance process. This is beneficial for Uganda’s revenue collection performance, encouraging voluntary compliance and expansion of the tax base.
He said the number of annual tax payments in Uganda is 31, a figure above the global average of 24.
This shows that there is room to streamline various payments required (for instance corporate income tax, VAT, withholding tax, PAYE, NSSF and Local service tax among others).
“While the post filing index indicates only 15.5 weeks to obtain a VAT refund, the more recent experience indicates that refunds in general are now taking longer and there is a need to align the refund process with the self-assessment system whereby taxes are paid/refunded based on the taxpayer’s return/declaration and then audited on a post-filing basis,” Mr Marshall explained.