By KABONA ESIARA KIGALI Rwanda (Xinhua)
-- Regional tax bodies have registered
shortfalls in revenue collections in the first four months of
the 2016/17 financial year, with top Ugandan, Kenyan and
Tanzanian revenue officials fearing huge tax gaps.
During a recent
meeting for tax administrators in Kigali, the Rwanda Revenue
Authority (RRA) said it had missed its tax revenue target by
four per cent. It also missed its non-tax revenue target. RRA’s
tax revenue target was Rwf333.4 billion ($153 million), but only
Rwf323.3 billion ($148.7 million) was collected between July and
According to Richard
Tusabe, RRA’s Commissioner-General the shortfall in revenues was
as a result of fraud perpetuated using false invoices to claim
For the Kenya
Revenue Authority (KRA), the target was to collect Ksh435,424
million ($4.2 million), but only Ksh420,707 million ($4 million)
While taxes from
petroleum raked in Kshs45,517 million ($446 million), which is
above the targeted Ksh37,609 million ($368.8 million), low
collections from international trade revenue, domestic revenue,
fees and licences hindered KRA from meeting its target.
KRA faces a
challenge of under declaration of import values at the Mombasa
Port leading to loss of millions of dollars in taxes. Also some
goods declared to be in transit sometimes end up in the local
commissioner-general John Njirani is pushing for a regional
initiatives to improve tax compliance.
Tanzania is also
grappling with low tax revenues. Data from the Tanzania Revenue
Authority (TRA) show that the tax body was expecting at least
Tsh4.7 trillion ($2 billion) but only collected Tsh4.6 million
“We have witnessed a
significant decline in import trade passing through our port.
Imports for the Tanzania domestic market declined by 10 per
cent. In the region imports for Democratic Republic of Congo
declined by 18 per cent; in Zambia by 19 per cent; in Burundi by
21 per cent and in Uganda by nine per cent,” said Mary M Ngelela,
director of planning and research at TRA.
The Uganda Revenue
Authority (URA) is equally struggling to meet its revenue
collection targets. The country was hoping to collect
Ush3,890.29 billion ($1.07 billion) but only collected
Ush3,723.67 billion ($1 billion) between July and October.
Commissioner of Customs at URA attributes the falling import
revenues in the region to increasing consumption of
locally-manufactured goods as they have become cheaper with the
depreciation of the local currencies.
The low global
commodity prices have also reduced tax collections. For
instance, steel prices which were at $1,000 per tonne have
dipped to $300-$350 per tonne.
Wheat has also been
hit hard by the depressed global prices. The prices of wheat
have fallen from highs of $650 per tonne to $400 per tonne.
For South Sudan, tax
revenues have remained small with revenue contributions
stagnating at four per cent of GDP.
The tax revenues
have dropped from $80 million in the 2012/13 fiscal year to $50
million in 2015/2016 fiscal year following the civil war and
decline in oil price.
“Each shock has
reduced our national income (the amount of money produced in the
country). But government expenditure has not fallen by the same
amount. We have financed expenditure by running down our
reserves and borrowing — primarily from the Bank of South Sudan.
This has created annual inflation of 730 per cent, and meant the
Southern Sudan Pound has lost 80 per cent of its market value in
the past year,” said Albino Chol Thiik South Sudan’s
Director-General of taxation at the Ministry of Finance and
South Sudan’s economy will not recover sufficiently to allow the
government to provide salaries and services,” he added.
The region’s tax
revenues have also been affected by a steady increase in
duty-free goods from regional economic blocs.