Recent Revenue Bargains in Uganda, 2008-2018: Actors, Context and Trends

The Ugandan government in the past decade or so undertook measures aimed at casting the taxman’s net wider and growing the country’s revenue yields. This included the introduction of a series of new taxes and significant changes to the existing tax laws. Uganda’s rapidly changing social and demographic landscape has necessitated the need for increased revenue and resource mobilisation to deal with supply of critical public goods and services. What is more, politically, the incumbent NRM regime increasingly needs more financial resources to oil its patronage machinery and shore up its support. This need became more urgent as western donors grew dissatisfied with the state of governance and as the government sought to wean the country off donor dependence. In the range of reforms relating to revenue mobilisation, there have been negotiations and bargains, contests and controversies, and demands and drivers that need careful theoretical analysis and critical empirical investigation.

In this paper, we seek to understand the underlying dynamics, the actors, the movers and the bargains in recent revenue reforms. We investigate the nature of the changes and the political economy context in which they have unfolded and evolved. Specifically, we focus firstly, on the exemption of members of parliament’s emoluments from income tax; second, the evolving regime for taxation of petroleum operations related to the discovery of oil in the Albertine region in Western Uganda; third, the expansion of the threshold for presumptive taxation from UGX 50 million to 150 million under the Income Tax Act since 2014; fourth, the introduction of the Over the Top (OTT) tax on social media access, including Facebook, Twitter, WhatsApp and YouTube; fifth, taxation of mobile money transactions; and finally, excise duty on bank and mobile money charges, recently increased from 10 to 15 percent.