URA starts using NIN to profile taxpayers

KAMPALA — Uganda Revenue Authority (URA) is moving to link taxpayers to their national identity records, a shift that could give the taxman a much clearer picture of citizens’ economic activities as government intensifies efforts to raise more domestic revenue.

The new system will use the National Identification Number (NIN) to replace the separate Tax Identification Number (TIN) for Ugandan citizens, while biometric authentication is expected to make it harder for people to access or transact on another taxpayer’s account.

The move could also allow URA to connect information from different parts of the economy—including banking, mobile money, business registration and trading licences—to a single taxpayer identity, potentially making it harder for businesses and individuals to conceal taxable activity.

URA Assistant Commissioner for Client Services Christine Mirembe said the authority has already started mapping and profiling taxpayers using their NINs.

The first phase, which requires taxpayers to submit their NINs, will run until the end of September, she said.

“We have given Ugandans up to the end of this month to provide us with their NINs. In this first phase, we have started with improving the taxpayer’s profile with a picture. Currently, when you open your taxpayer profile, it has no picture, and someone can easily take advantage,” Ms Mirembe said.

She said adding biometric identification would strengthen the security of taxpayer accounts and reduce fraud.

“We want to eliminate fraud. Aligning people’s TIN with their NIN means we shall have your biometrics as well, and anyone who does a transaction on that profile will be the owner, and access will be through biometric fingerprint,” she said.

The change follows a government decision to make the NIN the default tax identifier for Ugandan citizens, removing the need to obtain a separate TIN.

Wider tax net

Beyond replacing one identification number with another, the reform is intended to give URA a more complete picture of taxpayers and their financial activities.

Ms Mirembe said the NIN will provide a unique identifier through which URA can connect information held across different government and financial systems.

This, she said, could help the authority establish the actual income and business activities of taxpayers and identify gaps between declared income and economic activity.

For example, a taxpayer who claims to have stopped operating a business could still be identified through related financial or commercial transactions, she said.

The system is therefore expected to strengthen tax compliance and help tackle evasion and fraud at a time when government is seeking to raise more domestic revenue to finance its budget and reduce reliance on borrowing.

Tax authorities have increasingly sought to use digital information and data matching to identify taxpayers who may be outside the tax net or whose declared economic activity does not correspond with their transactions.

However, the increased ability to link information also raises questions about how taxpayers’ personal data will be accessed and protected.

NIRA draws the line

The National Identification and Registration Authority (NIRA), which holds the national identity database, sought to allay concerns that the reform would result in the automatic transfer or merger of citizens’ personal information between the two institutions.

NIRA Executive Director Rosemary Kisembo said the authority will retain its database separately from URA.

“We shall only help them in verifying that the person who registered for taxes is the right person, with all his data corresponding with what we have,” Ms Kisembo said.

She said access to identity information would require biometric authentication and consent from the individual concerned.

“For the data to be retrieved from NIRA, there has to be consent proof from the owners. It is not going to be that we share it anyhow,” she said.

NIRA’s clarification means the reform is not, at least formally, a merger of the two databases. Instead, the two agencies will maintain separate systems while allowing identity verification where authorised.

Phased rollout

Taxpayers who supplied their NIN when obtaining their TIN will not immediately complete the entire transition.

Ms Mirembe said the second phase will require taxpayers to provide consent before the full registration process is completed.

She also warned that taxpayers who fail to voluntarily provide their NINs could still be identified through URA’s collaboration with NIRA, noting that the tax authority has a legal mandate to register taxpayers.

The government expects the transition to create a more interoperable public information system, with the NIN serving as the common reference point for citizens across government services.

For URA, the significance goes beyond simplifying tax registration. The bigger prize is the ability to match identity with economic activity, potentially giving the taxman more tools to detect undeclared income, improve compliance and expand the domestic tax base.

The success of the reform, however, will depend not only on the technology but also on public confidence that the information being linked across government systems is accessed lawfully and protected from misuse.