Payments of bonuses and terminal benefits by some companies to their employees and former employees have tipped over Uganda Revenue Authority (URA’s) Pay as You Earn (PAYE) collection scales by Shs120 billion.
Whereas URA had projected it would collect Shs1.562 trillion between July 2016 and April 2017, it has collected Ushs1.682 trillion.
The Finance ministry also attributes the increased PAYE collections to enforcement by URA’s Public Sector Office (PSO).
That, the ministry says in the June 2017 Background to the Budget Fiscal Year 2017/18, resulted into remittance of PAYE arrears by local governments and municipalities.
“However, there are risks to the performance of PAYE going forward due to the laying off of employees by some companies and these include MTN Uganda and CNOOC,” it adds.
In January this year, MTNU laid off 100 workers though the company said the workers had volunteered to retire.
Relatedly, collections from indirect taxes (Valued Added Tax – VAT and excise duty) over the same period were above projections.
URA collected Shs2.3 trillion against the target of Shs2.3 trillion from VAT and excise duty.
In the next fiscal year, which will start on July 1, 2017 and end on June 30, 2018, URA is projected to collect Shs334.46 billion through VAT, excise duty, import duty; nontax revenue.
Of that, Shs197 billion will be from the infrastructure levy and Shs50 billion from the reinstatement of a 10 per cent import duty on crude oil.
About Shs32.46 billion will be from excise duty on beer, wine, spirits and soft drinks, Shs30 billion from VAT on wheat grain.
Also, the government – through the Uganda Revenue Authority (URA) – will collect Shs8 billion from Withholding Tax on winnings from gambling, Shs5 billion by including Local Service Tax on URA’s scope of revenue sources.
Collections from firearms licenses will be Shs2 billion whereas from lotteries and gaming it will get Shs1 billion.
According to the Finance ministry, the companies that paid out the bonuses and terminal benefits are in the banking, soft drink, beer and telecommunication sectors