EAC countries miss global tax pooling targets

Kenyan President Uhuru Kenyatta (L) meets his Rwandan counterpart Paul Kagame (R) at State House Entebbe yesterday. The two leaders later agreed with President Museveni to build an oil pipeline from the East African coast to Rwanda. PHOTO by Rachel Mabala 

 

By Ismail Musa Ladu

Posted  Wednesday, July 31  2013 at  00:00

In Summary

Global economic slowdown had a bearing on the region’s revenue collections.

All regional partner states performed below the target in international trade revenue mobilisation, with Rwanda emerging the highest with 94 per cent, followed by URA at 90 per cent and Kenya Revenue Authority garnering 87 per cent.

Analysts say this is largely attributed to a slowdown in European markets.

According to the latest Economic Policy Research Centre survey, revenue collections have been sluggish due to the debt crisis over the past years, causing lower demand for the goods on the largest markets in the world.

But Rwanda has closed its previous financial year with a surplus as its other East African regional peers, among them Uganda, suffered revenue deficits.

This, according to tax and economic analysts, demonstrates Rwanda’s strength in mobilising revenues.

Explaining why Rwanda seems to be ahead of its peers, the Deloitte manager of tax services, Mr Martin Makumbi, said: “It is hard to control things like a slump in imports and outcomes of elections that all have an impact on trade. During Kenya’s election, trade slowed and that coupled with strength of the economy explain why Uganda could have failed to hit its target.”

Rwanda’s efforts to embrace technology to drive its systems and development agendas, also explain its performance.

“Rwanda Revenue Authority registered a performance of 101 per cent in gross revenue mobilisation with Uganda Revenue Authority posting a 98 per cent,” the URA commissioner general, Ms Allen Kagina, said last week.

She continued: “And Burundi Revenue Authority registered a performance of 91 per cent while Kenya registered 90 per cent.”