OPINION: How Government Can Mint Billions from Number Plates Alone

Julius Peter Ochen

By: Julius Peter Ochen

At the time when all institutions and departments of government should be thinking of how to increase money into government coffers, troche Ministry of Finance seems to be thinking otherwise.

You cannot be serving capitalistic government and fail to endure business mentality in your daily practices and public services.

Am referring back to a decision by Ministry of Finance that increased tax on personalized number plates for motor vehicles from 6M UGX to 20M UGX, an increment of almost 400%.

What is a number plate in the first place and why does authority issue number plates?

Wikipedia describes number plates as metal or plastic plates attached to a motor vehicle or trailer for official identification purposes.

Ok, if the whole tenacity of number plates since its inception is just for identification purpose, why does URA charge a whopping 20M for those who want to be identified easily?

Is it any easier to identify a car with plate such as UAX 159W than the one bearing the name, for instance PAJULE?

Assuming there is run over accident on a highway, which of the two cars is most likely to be identified by eye witnesses? In any case, personalized number plates compromises security of the owners, why ask them to pay heart breaking amount as much as 20M for it?

The ministry of finance first introduced personalized number plates at a fee of 3M, then increased it to 5M. The motivation for increment continued to 6M then whopping 20M in 2015/2016 budget even on realization that the more they increased, the lesser the taxes they collected.

I would like to introduce new line of thinking. Why don’t we rebrand the same number plates so that on addition to identification purpose, it also becomes a show of class of some sort with intention of generating more revenue out of it?

Sometime the babes and the wenches don’t know how much our dusty cars cost until the plates elevate us apart. We can do that by classifying the plates into categories, say four types.

The first category we call it platinum and charge 3.7M for it. The second category we call it Silver and charge 5M shillings. The third category we call diamond and charge 6.5M for it.

Then the ultimate show of class we call it golden and charge 8M.  It shall be a well-designed piece of metal with artistic touch to give it the required class.

Let’s get down to figures and see if my pitch makes sense. Currently, URA clears about 16,000 cars monthly. If 15,950 of which are taxable cars then URA earns about 20B shillings on registration alone a month. With increased fee on personal number plates, URA gets only one car in three months. Which mean, government earns only about 80M from this madness in a year. Previously when the fee was 5M, government would earn upto 500M every single year.

So, let’s think business. If out of 16,000 cars cleared every month, 200 are enticed for platinum plates, government would earn about 8.8B. Again, of the remaining cars, if 100 can be attracted for Silver plates; that would mean about 6B shillings per year to government.

And if 60 cars out of 16,000 can pay for diamond plates, government stands to collect about 4.7B in a year. Here, we would be targeting cars costing above 150M in the bonds.

If 15 cars out of 16,000 are attracted for ultimate show of class; Golden number plates, URA could bag 1.5B in a year. The remaining 15,625 going for general plates will still collect for URA 225B.

At the end of financial year, under the categorization of the plates, government could collect 250B shillings. This would mean additional revenue of about 30B from the current platting system.

It may sound a figure, but what can 30B shillings do? It can train 1,200 doctors for 5 years. The same amount can pay 6,500 primary school teachers for the whole year, and can buy up to 85,000 ordinary beds or 400,000 mattresses in our health centers.

Putting this amount to a better perspective, between November 2015 to April 2016, about 6,000 children in northern Ugandan died of malaria alone.

Ministry of health needed only 2b shillings to intervene in the malaria outbreak but government couldn’t get that money for 6 months. Whether it was a matter of financial drought, or rather negligence or lack of priority on the side of government is a matter for another discussion.

I am also mindful of the fact ensuring more revenue to the government alone, without a system in place to safeguard rightful use of collected funds is complicated as social situation of an obnoxious, resource constrained, shy village disable man. God Bless Uganda.

The writer is a public policy analysis with interest in politics


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