Mbale City Council has decided to suspend the collection of fees related to street parking, loading and offloading, and advertising. The move comes after contractors consistently failed to remit monthly local revenue collections to the council account, prompting authorities to take decisive action.
James Kutosi, the spokesperson of Mbale City, highlighted the failure of contractors to transfer the collected revenue to the city treasury, raising concerns about the transparency of the process. Kutosi urged the public not to pay taxes until further notice, emphasizing that those still collecting dues are doing so illegally.
Despite the city’s 2021 initiative to implement digital revenue collection through the Integrated Revenue Administration System (IRAS), authorities now allege manipulation by some officials. Contractors, reportedly in collusion with division officials, are accused of disregarding the directive to use the electronic payment system, opting for manual receipts instead.
While local governments using electronic systems have experienced doubled revenue, Mbale City is facing challenges with the implementation of IRAS. Some individuals collecting fees allegedly issue chits instead of receipts, contributing to financial discrepancies.
City officials pointed out that the problem originated within the council itself, with accusations of contracts being awarded to close relatives and friends. Stakeholders, including the director of Makerere University, Mbale branch, expressed concern about the potential financial strain resulting from the suspension of revenue collection.
Mbale City’s deputy speaker, Abdullah Magambo, blamed technical authorities for the mess in revenue collection and anticipated a loss of income due to the suspension. Calls for a forensic audit of local revenue in the city were made by youth councillor Wilson Lukaye and retired accountant Harriet Mutonyi.
Despite the suspension, contracted individuals collecting street parking dues claimed they have not received official communication about terminating their contracts. The city mayor, Cassim Namugali, highlighted the financial challenges faced by the council, collecting only Shs320 million out of the projected Shs1.5 billion in the last quarter.
This suspension follows a similar move last year, indicating ongoing challenges with revenue collection in Mbale City. In 2021, a forensic audit was ordered to investigate mismanagement and under-declaration of revenue in Mbale City.
