Musasizi Calls on Members of Parliament (MPS) to Back Tax Base Expansion

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Finance Minister Henry Musasizi has called on Members of Parliament to support efforts to broaden the tax base as Government seeks to raise domestic revenue, reduce dependence on borrowing and strengthen fiscal self-reliance.

Speaking during the Uganda Revenue Authority (URA) engagement with Parliamentary committees at Serena Hotel in Kampala, Musasizi said Government is targeting an increase in the revenue-to-GDP ratio from the current 14.7% to 20% by FY2029/30. “The answer cannot simply be higher tax rates. We cannot achieve 20% by continuously taxing the same people more,” Musasizi said, urging Parliament to support measures that bring more eligible economic activity into the formal tax system.

He said additional revenue should come from economic growth, broadening the tax base, formalisation, improved compliance, better administration of existing taxes, taxation of emerging economic activity and reduction of revenue leakages. He linked domestic revenue mobilisation to Uganda’s US$500 billion economy ambition under the Tenfold Growth Strategy, saying the country cannot build that economy indefinitely on borrowed resources.

He urged MPs to protect the tax base, support formalisation, digitalisation and information sharing, strengthen accountability and promote tax compliance. “Revenue mobilization and expenditure accountability are two sides of the same coin,” he said, stressing that Government must obtain greater value from every shilling collected.

URA Commissioner General John Rujoki Musinguzi said Uganda’s tax base is changing, presenting new challenges for revenue mobilisation, including structural informality, rapid growth of the digital economy, cross-border businesses and offshore incomes, fragmented data, regional tariff harmonisation and illicit trade. He said the extractive sector also requires specialised tax capabilities, adding that URA is working towards sector formalisation and tightening digital regulation.

Musinguzi said URA will focus on mapping and registering priority sectors, taxpayer education and compliance, and risk-based enforcement.

He also called for stronger information sharing across Government institutions. Finance Committee Chairperson Maximus Ochai, MP West Budama County North, said Parliament wants more time to scrutinise proposed tax measures before the next financial year. Ochai said the timetable for formulating tax policies requires review, proposing that tax bills currently presented to Parliament on April 4 should be brought forward. “With those proposals, we would wish to have the standard reports that inform the greatest tax measures,” Ochai said.
Distributed by APO Group on behalf of Ministry of Finance, Planning and Economic Development, Republic of Uganda.

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