‘Uganda has second lowest tax burden in East Africa’

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Uganda has the second lowest tax burden in East Africa and one of lowest burdens in the world according to the permanent secretary in the Ministry of Finance, Planning and Economic Development, Ramathan Ggoobi.

Ggoobi said that Uganda’s tax burden stands at 11.8% and is ranked 140th in the world out of 170 countries. The only country in East Africa with a lower tax burden is Tanzania at 11.7 percent and is ranked 141. 

He revealed this on April 12, 2024, while releasing sh7.687 trillion to finance government expenditure for the fourth quarter of financial year 2023/24. 

According to the Heritage Foundation which measures tax burdens, Kenya stands at 17.4% and is ranked 93, while Rwanda is at 17.1%.

The developed countries tend to have a high tax burden with Denmark standing at 46.3%, France at 45.4%, Belgium at 41.9%, Sweden at 43.9%, Italy at 42.4% Cuba at 41.3% and ranked number six in the rankings.

“People say they don’t want to pay taxes because they don’t see what the taxes do. You cannot see what the taxes can do when we do not have the revenues and we are among the lowest taxpayers,” Ggoobi explained.

Ishmael Magona the acting director of budget at the finance ministry said funds were being released early enough and they do not want funds sent back of late releases as was the case in the past.

According to tax experts, taxes often determine winners and losers in the economy. Under a well-designed revenue system, taxes would be neutral. If taxes are applied consistently and evenly, they are less likely to be the driving factor in economic decisions.