The Ministry of Finance, Planning and Economic Development is in the final stages of drafting a National Tax Policy.
Expected to be made public in December, the policy will provide a set of guidelines for the taxation of goods, services, and income as a crucial tool for revenue mobilization.
This announcement was made by the State Minister for Finance (General Duties), Hon. Henry Musasizi, in response to concerns raised in a statement by the Leader of the Opposition (LoP), Hon. Joel Ssenyonyi, during a plenary session chaired by Deputy Speaker Thomas Tayebwa on Thursday, 08 August 2024.
Ssenyonyi expressed concern about over-taxation, which he believes has hindered the aspirations of small business owners and working families nationwide. He emphasized the importance of developing a comprehensive taxation policy to ensure that taxes are imposed based on a well-structured tax framework.
These concerns were raised in response to the President’s State-of-the-Nation Address delivered on 06 June 2024 at the Kololo Ceremonial Grounds.
In addition to taxation issues, Ssenyonyi also highlighted rising unemployment and the high cost of living, pointing out government’s ineffective use of borrowed funds, leading to many loans being mismanaged or left unutilized.
Musasizi acknowledged the increased debt servicing obligations resulting from government investments in oil and gas, along with related infrastructure projects like airports, oil roads, and dams.
He mentioned that Uganda’s nominal debt-to-GDP ratio currently stands at 46.91 per cent, below the 52.4 per cent threshold outlined in the Charter for Fiscal Responsibility.
To address these challenges, Musasizi stated that the government has revamped the loan acquisition cycle to focus on viable projects. Additionally, a Public Investment Management Strategy framework has been established to enhance the efficiency of public investments.
In regards to high youth unemployment, the minister highlighted government initiatives such as the Parish Development Model, EMYOOGA, and the Agriculture Credit Facility, aimed at boosting enterprises and households in both formal and informal economies.
Furthermore, Musasizi shared that automated systems in key accountability areas, including the Integrated Financial Management System and electronic Government Procurement, are being implemented to combat corruption in the country.
He emphasized that digitalization will also help address issues like medicine shortages in hospitals by improving the coordination between delivery, storage, diagnosis, prescription, and dispensing processes.
This content was distributed by APO Group on behalf of the Parliament of the Republic of Uganda.