What you need to know:
- Digitisation of the financial sector is largely dominated by mobile money platforms through enabling a number of services such as bills payments and interoperable services linking bank accounts to mobile wallets
Uganda Revenue Authority (URA) has said digitisation of the financial sector will go a long way in facilitating e-commerce, which will eventually ease tax administration.
Speaking during a symposium to discuss harnessing digitisation as a driver in reshaping the tax system to support financial sector development, Mr John Musinguzi Rukoki, the URA commissioner general, said digitisation of the financial sector implies that financial products and services offered digitally can be accessed remotely outside a physical branch or outlet.
Therefore, he said, there is need for effective tax policies that will encourage uptake of financial services that will positively impact tax administration and mobilisation.
“Digitisation of the financial services is beneficial to our economy and will positively impact financial inclusion, which is one of the objectives of the Financial Sector Development Strategy,” he said, noting that regulators and key players must be willing to share data for tax compliance management.
Digitisation of the financial sector is largely dominated by mobile money platforms through enabling a number of services such as bills payments and interoperable services linking bank accounts to mobile wallets.
“For a couple of years the number of financial services offered on mobile has increased as well as the number of mobile phone users. There is a direct relationship between digitisation of the financial services and financial inclusion,” he said.
Digitisation provides a conducive taxation environment due to the wealth of business data, which offers insights on incomes, persons for tax compliance and reduces the cash economy, thus impacting the informal sector.
The financial sector in Uganda comprises a range of formal and informal players, including the banking sub sector, non-bank financial service providers and development financial institutions.