Covid-19, political interference push down districts’ revenue collections

Gulu district local government recorded the highest local revenue collections the country in the 2019/20 financial year despite the effects of the Covid-19 pandemic on various sectors of the economy, a performance assessment report on local revenue performance in local governments has revealed.

The report compiled by Action Aid International Uganda in conjunction with the Uganda Local Government Association (ULGA) under the Local Revenue Mobilization and Service Delivery project shows that only 23 percent of the local governments met own revenue collectection targets in 2019.

This represents an 88 percent reduction from what was realized in 2018.

Raymond Mutyaba, the lead consultant in the study noted that due to the Covid-19 disruptions, there was a significant reduction in revenue collection across all local governments in the country. 

“Overall, in 2019 only 54 percent of local governments posted an increase in revenue collection of only 5 percent,” Mutyaba said. 

He noted that Gulu district collected Shs 910 million in 2019/20 financial, which is the highest among the 17 districts included in the assessment.

This however, was a reduction from Shs 1.03 billion the district posted in the previous financial year. 

Hoima came second with Shs 730 million followed by Buliisa with Shs 492 million while Masindi collected Shs 449 million, Katakwi Shs 457 million and Nwoya Shs 350 million. 

Amuru district had the lowest local revenue collections, posting Shs 81million.

“The property tax as a source of revenue was affected by the exemption of some taxpayers during the Covid-19 lockdown, inadequate sensitization, outdated valuation lists, poor service delivery and underdeveloped collection methods,” Mutyaba said. 

The assessment also discovered that the collection of trading license fees suffered a setback because of insufficient data on types of business, human resources, political interference and very low penalty. 

Ismail Ahmed, a principal inspector at the Ministry of Local Government noted that local governments some tax collectors in the local governments had become reluctant due to advance payments offered by the Ministry of Finance.


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