Uganda - Politics, government, and taxation

Like most African countries, the territory known as Uganda was an arbitrary creation of the European colonial powers. The borders cut across and brought together a whole range of ethnic and linguistic groups. Since gaining independence from Britain in 1962, the history of Uganda's politics and government falls into 4 broad periods.

The first period was opened at the country's independence with multi-party elections which brought the Uganda People's Congress (UPC) to power, led by Prime Minister Milton Obote. However, the Obote regime soon opted for a more authoritarian leadership. By using its base of support in the north of the country and the military to discard Uganda's traditional kingdoms and check its historical rivals in the south (who had been the country's elite during the colonial administration), Obote became the self-appointed executive president.

The second period began in 1971 when Obote was ousted from government by one of his key pillars of support, the military, led by Idi Amin. This was a major turning point for Uganda as Amin's 8 years of rule (1971-1979) saw the economy and political process collapse. Amin's regime used fear and racism as central instruments of policy and social control; over 300,000 people were murdered by the regime, and the vast majority of the country's 88,000 Asians were forcibly expelled and their land and other assets divided amongst Amin's followers. Economically, this was a disaster. After this policy had been enacted, the redistributed assets were placed in the hands of people who were inexperienced and lacked established business networks; this led to the decline of the productivity and efficiency of Uganda's business sector. Moreover, as Uganda's citizens became less confident in the stability of the formal economy due to Amin's unpredictable rule, they increasingly began to turn to the informal sector, thereby bypassing the state and its revenue-collecting authorities. In sum, the economy became less productive and more reliant upon the informal sector, both drastically reducing state taxation revenue. As state revenue was so depleted, the government began borrowing from international lenders at such a rate that Uganda became heavily indebted. These factors, in combination with the deteriorating terms of trade for Uganda's products on international markets after the decline of world economy in the 1970s, explain why the Ugandan economy was in dire crisis by the end of Amin's regime.

The third broad period of Uganda's political history began when Amin was finally overthrown in 1979 by a coalition of domestic forces under the banner of the Uganda National Liberation Front (UNLF) and the neighboring Tanzanian army. This led to an 8-year period of crisis and uncertain rule that plagued the country. After Amin's defeat, a string of 3 limited and short-term governments followed, led by the UNLF, President Binaisa, and President Lule, respectively. This period was one in which the economy was devastated further by continued widespread disruption, huge military expenditures, and the effects of the international rise of oil prices in 1979. This quick succession of regimes culminated in the corrupt and widely disputed multiparty elections of 1980 that reinstated Obote as president. Commonly known as Obote II, this period was characterized by 2 central dynamics. First, Obote attempted to address the country's considerable economic woes by approaching the IMF and the World Bank for financial aid. This aid was dependent upon Uganda liberalizing the economy with the hope that free market forces would make it more competitive in the world economy. Second, the social effects of this reform were negative, which in combination with the corrupt and heavy-handed rule of Obote II, culminated in growing popular support for the National Resistance Movement (NRM) led by Yoweri Museveni that was waging a guerrilla war from its support-base in Uganda's south.

The fourth key period of Uganda's political history began when the NRM took state power in 1986; the NRM remained in power in early 2001. With Museveni as president the NRM had seized power on the back of a set of left-progressive, anti-imperialist policies. However, because of the legacy left by Amin and his successors, the country was in a state of severe social, economic, and institutional crisis. Consequently, by 1987 the NRM was forced to go back on its initial left-progressive developmental policies simply because there was insufficient revenue to pursue such an approach. In fact, like Obote II, the NRM applied to the IMF and World Bank for aid that was conditional upon adopting free market reform.

Although Uganda's economy is claimed by many to have been in a relatively good state of health since the opening to free market forces from 1987 onwards, the political situation is somewhat more ambiguous. The country remains a "no party democracy." Museveni stresses that the NRM is not a political party but a national "movement" of a broad coalition of societal and political forces. As a result, while Uganda maintains a high level of press freedom (especially in comparison with most other African countries), political parties are illegal. A referendum in July 2000 saw 90 percent of voters favoring the continuation of the "no party system" which seems to have justified the NRM's political stance.

However, a level of contention remains about this system's legitimacy as the 2 most prominent opposition parties, Uganda People's Congress (UPC) and Democratic Party (DP), boycotted the referendum. Furthermore, the U.S.-based human rights group Human Rights Watch claimed in a 1999 report that, due to the illegal nature of organized opposition, the country has "a restricted political climate." Contemporary indications of discontent in Uganda are clearly illustrated by a series of violent insurgencies by dissident groups such as Joseph Kony's Lord's Resistance Army in the north and the Allied Democratic Forces (ADF) in the southwest. In order to counter these rebellions, the army now has permanent barracks in these volatile areas.

Presidential elections were held at the beginning of March 2001. Museveni won an easy victory with 69.3 percent of the votes compared to the 27.8 percent of his closest competitor, the politically progressive former army colonel, Dr. Kizza Besigye. Although Museveni's victory was tainted by accusations of intimidation, fraud, and violence (an estimated 5-15 percent of votes cast could have been compromised), this margin of potential electoral corruption still gave Museveni a sufficient mandate to hold onto the presidency.

Since 1998 Uganda has been at war in neighboring Democratic Republic of the Congo (DRC) to depose the Kabila regime first led by Laurent Kabila (who was assassinated in January 2001) and then by his son Joseph. This is a very complex war involving Rwanda, which supports a separate but similar anti-Kabila faction, and Angola, Zimbabwe, and Namibia, which all support the DRC government. The war is a considerable drain on the government's already sparse revenue; the Ministry of Defence received 33 percent of all ministerial allocations in the 1999-2000 budget. Yet by March 2001, Uganda was beginning to withdraw some troops from the DRC; however, this conflict has subsided and re-ignited before.

A key reform promoted by the IMF and World Bank was the restructuring of Uganda's taxation regime. One of the intentions was to lower the dependence on trade taxes, which reduced incentives for production, and to rely instead on indirect taxes on goods and services. Indirect taxes provided an average of 79.8 percent of total revenue between 1990-1998. Taxes on income and profits have steadily increased from 9.8 percent of total revenue in 1989 to 15.2 percent in 1998. Yet, of total taxes, about 50 percent still emanates from indirect taxes on only 4 products—petroleum, cigarettes, beer, and soft drinks. In fact, Uganda's tax revenue to GDP ratio is fifty percent below the African average.

The Uganda Revenue Authority (URA) was established to address the priority of improving government tax-collecting abilities. However, it is claimed that almost immediately after the creation of the URA its officials were involved in the major embezzlement of the funds it was set up to collect. In addition, throughout the government departments in 1997-98, US$120 million in tax revenue and government spending was unaccounted for. Due to these high levels of ingrained corruption, low levels of household income, and a small proportion of waged (thus taxable) labor, the majority source of government revenue still emanates from external donors. Of the government's estimated total financial requirement for 2000, US$1.467 billion was expected to come from domestic resources, whereas US$2.255 billion was required in external aid. It is due to regular deficits such as this that Uganda's external debt as a percentage of GNP has risen from 35.5 percent in 1985 to 58.2 percent by 1998.

Also read article about Uganda from Wikipedia

User Contributions:

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Oct 23, 2010 @ 9:09 am
Has Uganda changed in any way in its government system.All I see is corruption in its governance and whenwill that be???
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Nov 9, 2010 @ 3:03 am
WHY HAS THE CONSTITUTION OF UGANDA BEEN UNSTABLE SINCE 1962
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Nov 27, 2010 @ 12:00 am
It's so sad for the people that the rulers scrabble for power and money rather than trying to help them.
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Dec 29, 2010 @ 6:06 am
Uganda's leadership has been identified from two arms : military and political stagnation.The different rebellion in the country was a reflection of backwardness.In military , military coups and extra judicial killings left the social economic field in disarray let alone brain drain and expulsion of the entrepreneurial skill that would develop the economy Creating black market.Liberalization would be good policy if consumer protection was observed to minimize over exploitation by the capitalists. politics on the other side based on divide and rule policy ,crisis to the traditional institutions and threat to religious leaders denying them participatory roles case in point bishop luwums murder,abolition of kingdoms in late 60s and the divide between the north and south.The constitutional arrangement by different regime to suit their goals on the expense of the "wananch" and lack of ideological base has confused Ugandans creating politics of blame and black mail among leaders.Industrialization in Uganda has suffered in the early 70s from Amin and recently were privatization policy left Jinja industries shifted.In the northern part of Uganda, people has been traumatized due to wars creating camps due to the tyranny of kony since UNLA insurgency.patriots and Democrats are lacking in the policy sectors due to corruption ,poverty,dependence on foreign policies and dictatorial leadership.Education system has groomed transaction leaders than transformation leaders let alone to deny the uneducated to participate directly in policy formulation case in point qualifications required in parliament.The stability of constitution shall depends on every Uganda to have national issues,regional issues,local issues as common good to be enjoyed by every Ugandan.FOR GOD AND MY COUNTRY
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Feb 2, 2011 @ 12:00 am
politics of uganda has been improve more in the hand of the president yoweri kaguta musen but the obstacles come when the public decides to be in the political party
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Feb 28, 2011 @ 1:01 am
Uganda's politics have become alucrative business.so much is given out to the electorate and legislators.Presently leaders just think of extra polating their own pockets and have seriously forrgotten that us the electorate sent them to articulate issues that will make us go forward.MAY GOD SURELY COME TO OUR RESCUE
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Mar 31, 2011 @ 3:03 am
The politics of the country does not only depend on the politicians as many people may think. This is so in Uganda because of peoples ignorance about politics, some people take politics to be business to the and these are the majority in Uganda.
The acts of chaos happening in African countries shows the level of ignorance and backwardness we,instead of thinking of means development we put our eyes on politics, any way does every one want to be a president?, there is realy need for sensatisation on politics in uganda especially to the politicians like Besigye, Otunu, and the like, who like to use people for their own interests
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Jul 21, 2011 @ 12:12 pm
i want to know the uganda tax system and the percentage of tax revenue in uganda in economy?
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Sep 13, 2011 @ 4:04 am
the appetite for self aggrandizement far out-ways the appetite to see uganda out of political, economic and social chaos that the country finds itself in. the "saviors" of yesterday are the robbers of today. if vice presidents, prime ministers, and presidents repeatedly report on the front-line of newspapers in shoddy deals and they have no sense of guilty and shame but continue as usual where on earth do you expect to reach as a country except to leave off anarchy perpetuated by those who believe they have been sent by their god to rescue all of us.
ehms
David KOLE
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Jul 11, 2012 @ 5:05 am
Other than G/tax compensation given to districts what other revenues can further be apotioned to help lower local governments, especially the newly created districts?
okurut odeke
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Feb 20, 2013 @ 9:09 am
let the president of uganda think of leaving office to allow fresh leaders to plan for the country
Richard Stanley
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Sep 20, 2013 @ 10:10 am
Is Uganda safe for Americans traveling there? I have a daughter wanting to go on a mission trip.
Muzoora T Moses
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Nov 8, 2013 @ 4:04 am
Uganda's economy is now stable because of president Museveni's ruling, he has done alot to liberate our economy and this has putUganda on world map.
mukisa charles
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Mar 12, 2014 @ 4:04 am
Ugandans economic, political,social affairs through the freedom that was brought on by HIS excellence the president of Uganda a Y K museveni are now running very well in Uganda today.thanks to UPDF for peace provided to Ugandans all the time

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