URA nearly doubles telecom tax collections through digital monitoring

KAMPALA — Uganda Revenue Authority (URA) has nearly doubled tax collections from the telecommunications sector over the past five years after rolling out digital systems that monitor billions of telecom and mobile money transactions in real time.

Official figures show revenue from telecom services, mobile money and value-added services rose from Shs836 billion in the 2019/20 financial year to Shs1.59 trillion in 2024/25, representing a 79 percent increase.

The growth translates into an additional Shs754 billion in annual revenue, strengthening government’s capacity to finance public services while reducing pressure to borrow or introduce new taxes.

The increase has been attributed to the deployment of the Telecom Monitoring System (TIMS) and the Data Monitoring System (DMS), which independently verify transactions across telecommunications networks instead of relying solely on data submitted by telecom operators.

According to URA, the systems monitor more than five billion transactions every month, including voice calls, internet data, SMS, mobile money and other digital services.

The platforms also provide real-time forecasts of monthly telecom tax collections exceeding Shs120 billion, enabling government to improve revenue planning and cash flow management.

Another key feature is the electronic verification of every transaction, making it easier for the tax authority to detect under-reporting and improve compliance.

The systems also analyse mobile money payments in sectors such as betting and gaming, pay television and other merchant services, helping URA identify suspicious transactions and broaden the tax base.

URA Commissioner General John Rujoki Musinguzi has previously described technology as a key pillar in transforming tax administration.

“URA firmly believes in the transformative power of technology for efficient revenue collection, increased transparency and improved taxpayer experiences,” Mr Musinguzi said during the launch of the authority’s digital strategy.

Government officials say digital tax administration is helping increase domestic revenue without raising tax rates.

Speaking during the 2025 Uganda Economic Update, the Acting Permanent Secretary and Secretary to the Treasury, Mr Patrick Ocailap, said technology had become central to improving tax compliance and widening the country’s tax base.

“The use of digital systems is great for our country and will help URA collect more revenue,” Mr Ocailap said.

The gains in telecom tax collections reflect a broader trend in government revenue performance.

According to the Auditor General’s report for the 2024/25 financial year, total government revenue increased from Shs22.1 trillion in 2021/22 to Shs32.36 trillion in 2024/25, an increase of about Shs10.3 trillion, or 46 percent, over the three-year period.

The report attributes part of the improvement to technology-driven reforms that have strengthened tax administration, enhanced compliance and reduced opportunities for revenue leakages.

As Uganda continues to digitalise its economy, tax authorities expect automated monitoring systems to play an increasingly important role in improving revenue mobilisation, particularly in fast-growing sectors such as telecommunications, mobile money and other digital financial services.