Govt steps up revenue collection amid World Bank cut 

Different government agencies have heightened their revenue-collection enforcement, days after the World Bank’s decision to stop new financing in Uganda sent a wave of fear about an imminent tough financial situation.

A number of businesses are currently facing the wrath of different enforcement agencies, receiving emails and notices to pay up. Other measures have come in the form of express penalties for crimes such as drink driving, while police has mounted roadblocks to grab those that have not yet cleared their fines.

“I have not received these many notices in such a short time from URA,” said an owner of a small business. “Three different departments have contacted asking me for their money. I don’t even know who to answer to now. They all want money,” he said.

On August 8, 2023, the World Bank suspended its funding to Uganda following the enactment of the Anti-Homosexuality law. The law, according to its drafters, is meant to protect the traditional family by prohibiting any form of sexual relations between persons of the same sex and the promotion of such acts.

Following the enactment of the law, the World Bank deployed a team to Uganda to review our portfolio in the context of the new legislation. That review determined additional measures are necessary to ensure projects are implemented in alignment with our environmental and social standards.

“Our goal is to protect sexual and gender minorities from discrimination and exclusion in the projects we finance. No new public financing to Uganda will be presented to our Board of Executive Directors until the efficacy of the additional measures has been tested,” the bank said in a statement.

Following the bank’s decision, the state minister for Finance, Henry Musasizi revealed that the government is set to revise the budget, with the aim of cutting it back. The emoluments are going to be affected given the preliminary results.

Many experts feel that the recent enforcement measures are meant to collect more revenue for the government. For example, the Uganda Registration Services Bureau deregistered more than 186,000 companies over failure to file annual returns. There will be a cost to re-register.

The Uganda National Roads Authority has instituted penalties for those driving past the 100km per hour on the Entebbe Expressway. Kampala Capital City Authority has been monitoring different properties, demanding for property tax.

The National Social Security Fund has also been sending reminders to companies to pay up their contributions. Government is expected to source money locally. Borrowing from foreign sources remains costly as government is battling high debt levels. Cutting back expenditures remains the easier option.