Govt Urged to Tap into the Informal Sector Through Incentives

Andrew Rugasira, founder of Good African Coffee Uganda Ltd speaking at
the forum on Thursday

Government has been asked to lead the efforts to formalize the growing informal sector in Uganda through incentives if it is to increase the country’s tax revenue. The informal sector employs 80 percent of Uganda’s labor force since only 9, more about 000 jobs are available in the job market.

Joseph Muvawala, ailment the Executive Director National Planning Authority said on Thursday that government must tackle the issue of increasing domestic revenue. He was speaking during the 9th Open Minds Forum organized by Uganda Revenue Authority (URA).

“The informal sector is an inevitable and critical centre for transition for any developing country. We must not deal with the informal sector as a mere revenue tool but a strategic sector and this requires incentives, patient ” said Muvawala.

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Andrew Rugasira the proprietor of Good African Coffee Uganda in his key note speech challenged Ugandans doing business informally as frustrating government efforts to deliver services.

“We have to take responsibility by paying our taxes if we need to get better services. Our demands for good roads, schools and other services remain illegitimate cannot make demands if we aren’t contributing to the growth of our country.”

In his view, a higher tax ratio to GDP cultivates a favorable ground for leaders to listen to the citizenry. Rugasira said that corruption, weak institutional capacities and regulatory barriers are among factors hindering the efforts of formalizing most businesses.

Edward Kaziire the MD Kaziire Health Products urged those engaged in small scale businesses to embrace the idea of transforming to the formal sphere since it enables growth.

He said; “Before I registered my company with URA I used to lose business simply because clients asked for my proof of registration which I didn’t have. It was even hard to do trans-border transactions. The process of formalizing a business might be difficult but the benefits are enormous.”

The forum at Kampala Serena Hotel registered a high attendance of the general public including government officials, business proprietors and executives.


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