Govt spending went by Shs70.46 billion in November

Preliminary data by the Ministry of Finance, Planning and Economic Development shows that government operations in November 2021 resulted in an overall fiscal deficit of Shs724.46 billion which was higher than the planned deficit of Shs654.00 billion.Implying that due to increased public expenditure the government spending during the month went by Shs70.46 billion.  The Ministry of Finance, Planning, and Economic Development explain in the performance of the economy report for the month of November 2021 sent to Daily Monitor that this was on account of lower than targeted domestic revenue and grants during the month.The Ministry of Finance, states that government expenditure in November 2021 amounted to Shs2.497 trillion, representing a 97.2% performance against the plan of Shs2.568 trillion for the month.This performance was mainly on account of lower than planned spending under externally financed development activities during the month.“Development expenditure for the month amounted to Shs910.22 billion, representing an 80.9% performance against the planned Shs1.125 trillion,” said the Ministry of Finance.Adding: “Whereas expenditure on domestically financed development items was higher than the plan for the month by 29.6%, spending on externally financed projects was very low, at only 46.9% of the plan for the month which resulted in underperformance for the category of development expenditure.”Expenditure on recurrent items, on the other hand, was higher than the plan for the month by 9.0% as both wage and non-wage (other recurrent) categories performed at over 100%.Wages and salaries amounted to Shs503.79 billion against the earlier planned Shs455.18 billion mainly on account of additional recruitment under the health sector, Uganda Police and Uganda Prisons.Spending on other non-wage recurrent items totaled Shs696.03 billion, 12.6% higher than the initial plan. This performance was mainly on account of;- higher spending under the Ministry of Defense, Ministry of Education, and National Medical Stores to deal with the negative impact of Covid-19 on the affected sectors for example education, health, and security during the month.The Ministry of Finance says revenue and grants for the month amounted to Shs1.772 trillion against a combined target of Shs1.914 trillion. Both categories recorded shortfalls of Shs52.18 billion and Shs89.47 billion respectively.Domestic revenue collections for November 2021 amounted to Shs1.688 trillion, representing a 97.0% performance (Shs52.18 billion shortfall) against the target for the month.Tax revenue collections in November 2021 amounted to Shs1.582 trillion, registering a Shs27.75 billion shortfall against the planned target of Shs1.609 trillion. The shortfall was mainly registered under the category of indirect taxes which more than offset the surplus registered in international tax collections.Indirect domestic tax collections amounted to Shs384.22 billion, which translated into an 83.2% performance (Shs77.44 billion shortfall) as both Value Added Tax (VAT) and Excise duty were below respective targets by Shs55.89 billion and Shs21.54 billion. Performance under VAT was mainly affected by lower than anticipated production of spirits, soft drinks, beer, and cement during the month.“Direct domestic tax collections amounted to Shs470.10 billion against the planned Shs470.48 billion for the month. Shortfalls were registered under the corporate tax, Withholding tax, and rental income tax, although these were offset by the Shs48.06 billion surplus that was registered under PAYE,” the Ministry of Finance said.[email protected]