Minister of State General Duties, Ministry of Finance Henry Musasizi has revealed by the end of FY 2023/24, Uganda’s Gross Domestic Product – GDP is projected to expand up to shs206.54 trillion (USD54.99 billion).
This in turn is projected to grow the GDP per capita to USD 1,182, up from USD 1,093 this financial year ending this June, he said.
Minister Musasizi was on Tuesday speaking at the Uganda Revenue Authority – URA Post Budget Engagement.
He said that the country’s economy has continued to grow steadfastly; GDP growth for the year ending 30th June 2023 being projected at 5.5 percent compared to 4.7 percent last financial year.
“The revenue collection target for the financial year 2023/24 budget is projected at Shs52.737 trillion compared to Shs48.130 trillion this Financial year. Collections from Domestic Resources will amount to Shs33.341 Trillion, while Project Support will amount to Shs8.256 Trillion. Budget Support will amount to Shs2.782 Trillion and finally, Domestic Re-financing (Roll-Over) will amount to Shs8.358 Trillion.”
He added, “Next financial year 2023/2024, economic growth is projected to reach 6 percent and average 7 percent over the medium term, on account of increased oil and gas activities, increased production arising from the implementation of the Parish Development model, regional trade and improved global conditions.”
According to Minister Musasizi, inflation is reducing steadily, something he attributed to the ‘well-coordinated fiscal and monetary policies.’
“Headline inflation reduced to 8% last month and it is expected to further decline this month. This implies that the cost of living will soon reduce back to pre-pandemic levels affordable by a median Uganda.”
The Government, he said, in upholding its commitment to attaining the cherished goal of a middle-income status for the country, has made targeted interventions geared towards inclusive growth and socio-economic transformation including;
a) Effective implementation of the Parish Development Model (PDM) to lift more Ugandans out of the subsistence economy.
b) Upgrading of our transport infrastructure by beginning the construction of the Standard Gauge Railway (SGR) and road maintenance.
c) Promoting use of small-scale solar powered irrigation to adapt ourselves to climate change.
d) Building infrastructure in industrial parks (connecting them to electricity, water, paved roads, ICT and other infrastructure);
e) Investment in oil and gas to start production on schedule;
f) Support to science-based Research and Development to kick start a knowledge-based economy;
g) Continued support to the private sector to access affordable capital through Uganda Development Bank (UDB), Uganda Development Cooperation (UDC), Agricultural Credit Facility (ACF), Small Business Recovery Fund (SBRF), Emyooga etc.
h) Investment in tourism promotion and development to market Uganda; and
i) Enhanced domestic revenue mobilization to collect more resources to finance our development agenda and reduce borrowing, and
j) Continued investment in peace and security which are the bedrock for socio-economic transformation.
He noted that the National Budget Month is objected at;
Increasing public ownership of the National Budget and participation in Government programs by increasing their involvement and awareness of Budget activities and initiatives;
Equipping Ugandans with knowledge and information on the budget and how to effectively monitor budget execution at all levels of Government;
Identifying weaknesses and reforms based on evidence needed to improve implementation, among others.
These, he said have enabled the Government to interact with citizens on budget-related through which it has achieved;
Improved transparency and accountability for public resources to improve public image and trust in Government, participation of the citizens in the budget process and Government programme, and improved collaboration amongst Government Agencies in demonstrating accountability for Public resources.
The Authority’s Commissioner General – John Musinguzi Rujoki noted that Ugandans through URA have a task to contribute 29.7 trillion shillings which is about 56% of the national budget.
“Comparing this with our contribution in the current financial year, which is expected to be 25.5 trillion, we are expected to grow our revenue domestic revenue by 4.2 trillion.”
Mr. CG is, however, optimistic that with support and the sacrifice that taxpayers have been making over the years, they [URA] will be able to achieve this.
He revealed that in the last three financial years consecutively, revenue has been growing between 12% and 15% but in absolute numbers, the growth has been about 2.5 trillion shillings.
“This year, we have an opportunity to double this and increase our revenue by 4.2 trillion.”
In fulfilling their mandate of collecting sufficient revenue for national development and reducing dependence on borrowing, Musinguzi urged taxpayers to tirelessly work together to sustain the nation.
He said, “In the next financial year we’re expected to contribute 56% of our national budget but our dream is that in the long term, maybe in a period of about five years, we’ll be able to fully fund our budget.”
Through this, Musinguzi said it is when the country shall fully attain its economic sovereignty as a nation.
“Therefore ladies and gentlemen, the journey ahead of us is a steep one but we have full confidence in you and we also have dedicated ourselves to measure up to the task and hence the need for this engagement.”
Mr. CG noted that the government has deliberately restrained from increasing the tax rates so as to facilitate businesses to recover from the impact of COVID-19.
“Therefore, the only way to go about this is by expanding our tax base by reaching the untaxed and the undertaxed, and bringing them onto a tax register, so that everyone can contribute towards the national involvement.”