Taxation Disparities Raise Concerns Among Citizens

A recent survey conducted by the Equal Opportunities Commission (EOC) has highlighted significant taxation challenges facing Ugandans, sparking widespread concerns among business owners, manufacturers, vendors, and other stakeholders.

The findings revealed that the high cost of doing business is a major issue, particularly for small enterprises in rural areas.

Many business owners reported struggling to stay afloat due to numerous taxes, licenses, and fees, coupled with levies on commodities like fuel and raw materials, which drive up operational costs.

Tax compliance was another critical concern, with many respondents describing Uganda's tax system as overly complex.

Small business owners and farmers shared frustrations about difficulties in filing taxes, understanding the rules, and managing multiple tax obligations.

Without adequate guidance or support, many end up making errors or disengaging from the system entirely, exposing themselves to fines and penalties.

Respondents also expressed dissatisfaction with inadequate transparency in the utilisation of tax revenues.

Many believed the government has failed to demonstrate how tax collections are being used, particularly in rural areas where public services like healthcare, education, and infrastructure remain underfunded.

Despite their contributions, citizens feel disconnected from tangible benefits, leading to calls for greater accountability.

Perceptions of unfairness in tax collection further fuelled frustration. Small business owners and workers in the informal sector alleged that they bear a disproportionate tax burden, while wealthier individuals and large corporations exploit loopholes to avoid paying their fair share.

This perceived inequity has deepened mistrust in the tax system.

Additionally, multiple taxation emerged as a significant grievance. Rental property owners and small business operators reported paying overlapping taxes to different authorities, including income tax to the Uganda Revenue Authority (URA), property rates to local governments, and various trade license fees.

This duplication of taxes on the same income or property has left many struggling to remain profitable.

The survey underscores the urgent need for tax reforms to address these disparities and build a fairer, more transparent system that supports economic growth and reduces the burden on ordinary citizens.