Domestic Revenue Mobilization for Development Quarterly Report 1st Quarter 2021

The Activity commenced on January 21, 2020, and runs through January 20, 2025, and is being implemented by Nathan Associates Inc. in partnership with subcontractor, Cardno Emerging Markets. The Activity builds on gains achieved during the 18-month pilot that ended in 2018, which was highly appreciated by counterparts in the Uganda Revenue Authority (URA) and the Ministry of Finance, Planning and Economic Development (MoFPED). The Activity is comprised of three components: Strengthening Tax Policy, Improving National and Sub-national Revenue Administration, and Enhancing Public-Private Dialogue. Component 1 focuses on equipping the Ministry of Finance, Planning, and Economic Development (MoFPED), the Uganda Revenue Authority (URA), and other policymakers with the tools and skills to conduct policy analysis, evaluate, and communicate the impact of tax and non-tax revenue reforms. Component 2 is focused on enhancing voluntary taxpayer compliance by strengthening taxpayer education, registration, data analysis, and arrears management. Component 3 is designed to build capacity within the private sector and civil society to participate in and influence tax policy reforms and contribute to an informed dialogue on taxation. During the quarter, progress was made under the respective components. Under Component 1, public consultative workshops were held on the draft new VAT law, analysis of the excise law and recommendations for improvements was undertaken, tax policy training was continued, and initial support for developing a stakeholder engagement strategy for MoFPED was commenced. Under Component 2, capacity building to URA continued, which included training staff in VAT audits and credibility testing, training in complex audits, and various courses provided by IBFD. Support in communications, debt management, and in excise duty administration also continued. Under Component 3, implementation of activities under the Grants Under Contract (GUC) program commenced during the last quarter of Y2. All six grantees made progress under their respective areas during the quarter as detailed in Annex B. Regular meetings of the Civil Society Forum were held during the quarter to map activities and ensure there were no overlaps or gaps in advocacy activities. More details of progress and results under the respective priority areas for each component are described under each Intermediate Result (IR) below. Intermediate Result 1: Tax Policy Strengthened focuses on improving the capacity of MoFPED to formulate and implement tax policy. Progress on rewriting primary tax laws includes the completion and submission of a final draft of the revised VAT law during FY 2021. The draft law aims to improve the tax system and increase revenue collection. The Activity also continued tax policy training and provided initial support for developing a stakeholder engagement strategy for MoFPED. Intermediate Result 2: Tax and Non-Tax Revenue Administration and Compliance Improved focuses on enhancing voluntary taxpayer compliance by strengthening taxpayer education, registration, data analysis, and arrears management. Progress includes capacity building to URA, which included training staff in VAT audits and credibility testing, training in complex audits, and various courses provided by IBFD. Support in communications, debt management, and in excise duty administration also continued. Intermediate Result 3: Public-Private Dialogue Enhanced focuses on building capacity within the private sector and civil society to participate in and influence tax policy reforms and contribute to an informed dialogue on taxation. Progress includes the implementation of activities under the Grants Under Contract (GUC) program, which commenced during the last quarter of Y2. All six grantees made progress under their respective areas during the quarter as detailed in Annex B. Regular meetings of the Civil Society Forum were held during the quarter to map activities and ensure there were no overlaps or gaps in advocacy activities. The Activity strategically combines grants and technical assistance to achieve activity objectives. The Activity is being implemented in partnership with the Uganda Revenue Authority (URA), the Ministry of Finance, Planning and Economic Development (MoFPED), and other key stakeholders. The Activity aims to create the fiscal space for public spending and investments in service delivery in priority sectors such as health, education, and agriculture.