The Independent Uganda: You get the Truth we Pay the Price
Kampala, Uganda | THE INDEPENDENT | Uganda has been ranked ahead of Tanzania and Kenya in the ease with which individuals and investors can file and pay their taxes.
According to the Paying Taxes 2020 report by audit firm PricewaterhouseCoopers (PWC) and the World Bank, Uganda is at position 92nd out of 180 economies ranked. Kenya is ranked 94th while Tanzania falls far back at position 165. Uganda’s rank is pretty much the same as of 2019.
Rwanda is ranked at number 38, an indicator the small east African state has taken key strides to make easy for investors to pay taxes.
South Sudan at 74th, surprisingly, ranks ahead of Uganda although the country has severally visited Kampala to learn how well they can set up their own tax body.
This index, together with the World Bank’s Doing Business report is followed keenly by serious investors that plan to inject their money in any economy.
Automation of services with steady network, is making it easier for business to know what taxes to pay and quick tax refund for those that file for Value Added Tax are some of the parameters looked at.
It takes a company a whopping 195 hours in Uganda to comply with its tax obligations. In Rwanda, it takes just 90 hours while in Kenya it takes one 179 hours. The lesser time it takes one to comply the better.
The number of payments also matter. Countries with lesser taxes a company has to pay rank highly.
Uganda scores favorably on post-filing index which includes refunds. A company that pays VAT but then sells its goods outside Uganda qualifies for a refund. Getting a refund quickly means a company has access to needed liquidity to invest back in the business.
In the report, the researchers said technology will be the answer to smoothing most of the processes for business to pay. It noted that “a failure to invest in digital technologies has resulted in a tax system that is more difficult to comply with than is the case in comparable countries.”
Abrupt new taxes also make it hard for individuals and companies to master and pay taxes.
The ranking, according to authors, helps governments and businesses understand whether their tax system are keeping pace with global change and helps them learn from what others are doing.
******
URN
