Parliamentary Committee Urges Government to Tap into Non-Taxed Areas and Plug Revenue Leaks for Budgetary Gaps

Kampala. Members of Parliament currently reviewing the national budget framework for the fiscal year 2024/2025 have urged the government to explore revenue streams in non-taxed sectors and address revenue leakages. The Budget Committee, during its interaction with officials from the Ministry of Finance, Planning, and Economic Development, stressed the significance of tapping into untapped areas to fund crucial priorities that have remained unfunded for extended periods.

Committee Chairperson Patrick Isiagi emphasized the need to scrutinize revenue collections from the Entebbe express road toll, pointing out a significant revenue discrepancy. The committee revealed that, while the express highway generates approximately 3 billion Shillings per month, only 7 billion Shillings in annual revenue have been declared to the committee by the Uganda Revenue Authority (URA).

MP Geoffrey Ekanya highlighted revenue leakages in gaming, lottery, and the mining sector, urging the Ministry of Finance to address these issues. He suggested that these areas could contribute up to 4 trillion Shillings, providing financial support for services not accounted for in the budget.

The Budget Committee also advocated for the taxation of gold, which they identified as a leading foreign exchange earner. They expressed concern over the tax exemption on gold and urged the government to reconsider this, emphasizing its potential to significantly contribute to the country’s revenue.

In addition to revenue-related concerns, the committee emphasized the importance of monitoring government expenditures, particularly in areas like procurement, to control wastage and provide additional support to the budget.

Furthermore, MPs raised questions about the operations of Uganda Airlines, describing them as unprofitable. They called for a thorough examination of the airline’s operations and expressed reservations about government financing the airline for a 20-year period, highlighting concerns about its profitability and the need for taxpayer support.

The committee recommended that, with recoveries from these identified areas, the government should allocate funds to critical areas such as the operationalization of the 10 new cities, ongoing externally funded projects lacking government contribution, tourism roads, and the upgrade of Akii-Bua Stadium in preparation for hosting the African Cup of Nations games in 2027.

In response to these recommendations, Henry Musasizi, the State Minister for Finance-General Duties, outlined the government’s plans to expand development financing options. He mentioned the implementation of a three-year digital strategy by the Uganda Revenue Authority (URA) to automate tax processes and reduce revenue leakages.

The Budget Committee is scheduled to present a report on the 2024/2025 National Budget Framework Paper to Parliament on January 25, 2024. The national resource envelope for the fiscal year is projected at 52.7 trillion Shillings.

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