The Government, under Uganda Revenue Authority (URA), has kicked off a project in which it seeks to match rental properties in Greater Kampala Metropolitan Area with their owners.
The project, which comes six months after government in June signed an agreement with a US-based data aggregator, seeks to maximise compliance in rental tax collection as well as creating a levelled playing ground in the rental properties sector.
It also seeks to enhance URA’s ability to map rental properties with the view of matching them with their owners.
Mr John Rujoki Musinguzi, the URA commissioner general, said in an emailed statement that the project is part of a larger plan in which the tax agency will use technology to improve efficiency and service delivery.
“It will help us settle the long-standing complications in identifying the right landlords of these properties we see around and what income is likely to be coming out of such properties,” he said, noting the project will create a level playing ground in the real estate market given that non-compliant landlords will no longer be able to underprice their properties.
In June, government through Ministry of Finance, signed an agreement with RippleNami Uganda, an affiliate of US-based RippleNami Inc, to build a data visualisation platform that would integrate different types of data to match rental properties in Greater Kampala Metropolitan Area with their owners.
The project also sought to use collected data to classify the nature of occupancy, key among them understanding whether a property is owner-occupied or rented as well as providing a digital address for each property.
Under the project, RippleNami will aggregate data from URA, ministries of Lands and Local Government, Kampala Capital City Authority, National Identification and Registration Authority, National Water and Sewerage Corporation, National Information Technology Authority and Uganda Communications Commission, to come up with a data base that will attach properties to owners and the value of rental income.
Ms Jaye Connolly-Labelle, the Ripplenami Inc chairperson and chief executive officer, said the project will leverage on blockchain technology to build a rental tax compliance system that integrates data silos into a register or ledger to easy data-driven decision making, not just for tax administration, but also for a wide range of other planning decisions.
Under the Income Tax Act, individual landlords earning more than Shs2.82m annually from rental properties, are required to pay 20 per cent of rental income tax after deductions while non-individual landlords pay 30 per cent of the chargeable rental income.
The project will also seek to build a system that offers real-time retrievable data for authorised government agencies.
URA has in the last two years implemented a number of technology-based initiatives such as digital tracking solutions and electronic fiscal receipting and invoicing system, in which it seeks improve tax efficiency and compliance.
Such initiatives, Mr Musinguzi said, will realise URA’s dream of doubling tax to gross domestic product ratio.
“We believe we can raise enough revenue to fund our budget, so that we don’t live on loans and indebtedness,” he said.
Currently, Uganda’s tax to GDP ratio stands at 14.3 per cent, which President Museveni has previously said is too low to influence real growth.
The ration, which is lower than Kenya’s 18 per cent and Rwanda’s 16 per cent, has stagnated only growing from 11 per cent in over 23 years.