The paper considers the economic, fiscal and social effects of macro-economic management introduced by the International Monetary Fund(IMF) and the World Bank in terms of financial sector and market operations. In this context, it is notable that the GDP growth averaged 6.85% (1991-1999), 5.52% (200-2006), 7.7% (2006-2010) and 5% (2010-2016). Other indicators show growth in export trade, expansion of the services sector, modest growth in manufacturing and growth in the tax to GDP ratio. Additionally, there was a fall in absolute poverty from 56.5% in 1993 to 19.7% in 2015. Nevertheless, the challenges are still discernible: a narrow tax base, inefficient tax administration and tax avoidance and evasion, driven by politically motivated exemptions.
The paper is based on a theoretical framework of political settlements and revenue bargain and assesses the role of actors relative to the fiscal reforms or changes achieved. The paper examines the broader policy and legislative implications and outcomes during the period under review.
These include:
1. The 1987 Currency Reform;
2. Creation of the Uganda Revenue Authority as a semi-autonomous revenue collection body;
3. The Investment Code Act of 1991;
4. Abolition of the coffee export tax in 1991;
5. Revision of the income tax threshold both generally and in relation to presumptive tax in 1995 and subsequently in 2014;
6. Replacement of sales tax and commercial transactions levy (CTL) with Value Added Tax in 1996;
7. Comprehensive revision of the income tax law in 1997;
8. Establishment of the Tax Appeals Tribunal in 1997;
9. Establishment of the Large Taxpayer Department within the URA and later abolition, although interest in the taxation of high net worth individuals (HNWI) continues;
10. Abolition of graduated tax and replacement with the Local Sales and Hotel taxes in 2008; and
11. Introduction of excise taxes on social media, mobile money transactions and mobile and bank charges.
Key Words: Structural Adjustment Programmes; IMF; World Bank; PSFU; KACITA ;taxation; URA ; tax to GDP ratio; Excise Taxes.