The problem of tax collectors who have never run any business

In April this year, we learned that the Uganda Revenue Authority (URA) staff medical insurance budget exceeded the budget allocation for Mulago national referral hospital.

For the financial year 2025/26, Mulago hospital had been allocated Shs 17.756 billion while URA had been allocated Shs 18.2 billion. With about 3,000 personnel, each had been allocated Shs 6m. This is way beyond many public servants’ annual salaries. Why?

What is so special about the folks working in URA besides pressing their computers and making phone calls? They aren’t an army that they are chasing tax defaulters. What special talents do they have to merit this special treatment?

By the way, the top 500 employees in this agency earn an between Shs 8m and Shs 9m monthly salary – perhaps the best paid in the country in addition to State House.

Why, then, would they add such a hefty insurance package? The reason is simple: these folks – mostly the 20 commissioners, and 480 assistant commissioners – feel that since they collect taxes, they are more valuable than the people from whom this money is collected.

When they look at the sums collected at the end of the day, they think they have done a major job and thus deserve bonuses and special treatment. They see URA as a private business in itself – the most profitable business in the country – which makes them see themselves as specially gifted.

Sadly, URA makes money from those who actually make money. There is no special genius about it. But I need to tell this story from the beginning. For some time now, I have asked to know the brains behind the taxes collected.

It is my humbling position that as businesspeople or members of the general taxpaying public, in our half-educated stature, we need to know the people imposing taxes on us: what logic or sense of things informs their tax regimes?

They also need to understand why we feel extremely burdened by their taxes, and why we see them as thieves occupying privileged offices. We need to have a public conversation.

This is not about our monies being misused by the government (extensively covered already), but the crippling nature of these taxes. Who are these people? Whom do they work for?

Oftentimes, I have asked myself: can any of these people crafting, imposing or implementing these taxes thrive under the same taxes? Have these people done any business? How did they thrive before crossing to salaried work?

Why would tax collection be more rewarding than doing honest business that they had to abandon their businesses and turn to tax collection? But while I ask these questions, I cannot shake off this nagging feeling that, without knowing the specifics, the majority of these tax collectors have never done any business.

From the so-called economists at the ministry of Finance (who have chosen to hide their faces from the public) to the so-called tax experts (also often anonymised), the aggressive tax collectors, the IMF-WB so-called experts, the majority – if not all of them – have little to no experience in the business world.

It is my nagging opinion that these fellas came straight from university (if they were formally educated) into salaried work with zero experience in business. Here, they had the chance to negotiate their salaries with a condition that the tax Pay As You Earn (PAYE) did not affect their final income – and thus, they don’t even care how much is collected from them as PAYE.

Because of their huge salaries, they don’t even feel the pain of indirect taxes, which is over 60 per cent of whatever they collect from all of us. One other nagging feeling I have struggled to shed off is that these taxes are simply imposed from outside, and these Ugandan workers – in the ministry of Finance/URA – are not different from the tax collectors of the colonial days.

I have many questions: Do these tax collectors actually care about the survival of the businesses from which they collect taxes? No. They don’t – they don’t even understand that a business has to thrive.

How does one explain the fact that a product could go through three taxation cycles in a single financial year – ironically, when the price of the same product on the market has not changed?

What explains the almost absolute lack of interest in foreign businesses (especially telecoms) under-declaring their profits even when the calculations are easy to make for the right profits these businesses make? What explains the exorbitant – almost extortionist – indirect taxes in an economy where one per cent barely earns a million in monthly salary?

Thus, when they chant “widening the tax base…” they are collecting taxes as a sport or as a private business to get “collection points,” bonuses, holidays and justification for their hefty medical insurance packages.

They don’t care or actually have no clue about the ecosystem in which ordinary individuals struggle to make their existence. No wonder, no one cares about protecting the small businessperson from foreign retailers and hawkers.

No one cares to protect them from the non-taxpaying businesses of so-called investors enjoying tax holidays or foreigners with capital borrowed from banks with manageable interest rates – especially in Europe and East Asia, India and China. No one cares.

No, this is not about Kampala City Traders Association. It is absurd to reduce and, therefore, discuss the whole of Uganda’s business environment and the extortionist taxes through the perspective and challenges of a ragtag business union.

yusufkajura@gmail.com

The author is a political theorist based at Makerere University.