Views: 1
The Ugandan government’s total spending in April 2024 reached sh3,463.61 billion, exceeding the target of sh2,992.43 billion by a rate of 105.09%. This information comes from a report released by the finance ministry on Tuesday, May 21.
His report attributed the higher-than-planned expenditure to a significant increase in recurrent spending. Wage payments, interest payments, and non-wage spending all surpassed their respective targets during the month, leading to a 31.92% increase in recurrent expenditure compared to the planned amount.
This surge in spending was primarily due to supplementary budgets allocated during the fiscal year to address shortfalls in wages and non-wage expenditures. These additional allocations resulted in higher expenditures than initially projected when the monthly budgets were set.
Wages and salaries expenditure amounted to sh603.18 billion, exceeding the target of sh537.74 billion. Similarly, non-wage spending reached sh1,485.85 billion against a target of sh992.15 billion, while interest payments totaled sh261.82 billion, surpassing the target of sh252.13 billion. The increase in interest payments was driven by depreciation pressures, which inflated the amount required for servicing external debt.
However, development expenditure fell short of expectations, totaling sh1,108.76 billion compared to the target of sh1,206.62 billion. This was primarily due to lower-than-planned spending on external developments, amounting to sh318.83 billion against a target of sh460 billion.
In April 2024, government operations resulted in a fiscal deficit of sh1,301.61 billion, significantly higher than the target of sh405.32 billion for the month. The report attributed this deficit to a shortfall in revenue and grants, coupled with higher-than-planned expenditure.
Domestic revenue collections in April 2024 amounted to sh2,127.39 billion, representing 89.4% of the target of sh2,379.73 billion. This shortfall of sh252.35 billion was mainly due to deficits in both non-tax and tax revenue collections.
Tax revenue collections totaled sh1,994.07 billion, falling short of the target of sh2,198.04 billion by sh203.97 billion. Taxes on international trade amounted to sh790.96 billion against a target of sh921 billion, registering a deficit of sh130.03 billion. Shortfalls in VAT on imports and petroleum duty contributed significantly to this deficit.
Indirect domestic taxes amounted to sh565.01 billion, falling short of the target of sh677.82 billion by sh112.81 billion. Lower-than-planned collections in VAT and Excise duty were the primary reasons for this deficit.
VAT collections totaled sh378.21 billion, reflecting a deficit of sh80.64 billion against the target of sh458.85 billion. Declines in production volumes of key vatable supplies, such as sugar, cement, and soft drinks, contributed to this shortfall.
Excise duty collections amounted to sh186.80 billion against a target of sh218.96 billion, registering a deficit of sh32.17 billion. Lower-than-planned collections in beer and spirits were the main contributing factors.
Direct domestic taxes totaled sh680.58 billion, surpassing the target of sh643.36 billion by sh37.22 billion. Higher-than-planned collections in Pay As You Earn (PAYE) were the primary driver of this surplus, reflecting increased recruitment and higher wages in the public and private sectors.