Case study: Revenue administration reform in Kampala – Areas of reform

Reforms to address these problems focused on three key areas:

  1. Investments in staff recruitment, training, and digitised updated databases

    For the DRC to operate effectively, it had to be staffed with a critical mass of qualified staff 5. When the KCCA was initially founded, the ED was given the opportunity to recruit a number of staff to build the foundation of the organisation. Given her previous work in the URA, she appointed a number of staff who had worked with her in the same agency. Other staff were recruited from a number of technical directorates in other ministries, departments, and agencies. In addition, all the Directorate’s staff receive monthly training and refresher courses on tax and operational guidelines, and changes in tax laws are incorporated as part of this training. The development of a cadre of competent and skilled staff thus provided the groundwork to introduce further reforms in the municipal tax administration. At the same time, the KCCA decided to introduce digitisation alongside an overall effort to improve service delivery through automation of revenue collection. To do this, they implemented an electronic revenue management system, eCitie, that allowed for automatic billing, reconciliation, and generation of receipts, and that sent out a reminder to taxpayers when they needed to pay their bills. As part of the system, the city rolled out its own taxpayer identification numbers (TIN) that allowed them to expand the tax base beyond that captured by the national tax identification system. The KCCA estimates that through the TIN reform alone, it was able to double its revenues from Commercial road user fees from USh 800 million UGX (over USD 222,000) to over USh 1.6 billion (over USD 444,000).

  2. In-house revenue collection

    In Kampala, the lack of oversight of outsourced private contractors coupled with poorly enforced contracts was a major source of leakage in revenue. High levels of corruption and wide private profit margins meant that limited revenues reached the government. As a result, the KCCA decided to bring collection back in-house, with collection having previously been outsourced to individual contracting firms. To effect this from the outset, the Directorate decided to cancel all existing out-sourced contracts. This was made possible because of well-trained and qualified internal staff. This played a significant role in improving revenue collection in Kampala. After tax collection was brought back in house, revenues from road user fees from minibus taxis, for example, doubled in one year 6.

  3. The taxpayer as a client: Communication and convenience for taxpayers

    Crucially, administration reforms focused on viewing the taxpayer as a client who requires good services. This was based on the idea that the better the service provision, in the form of simple and transparent payment mechanisms, the more likely taxpayers are to comply, as it becomes more convenient for them to do so. This included:

  • Improved convenience of payment: The KCCA implemented services that included being able to pay taxes through installments, which made it more affordable to some of their clients. Through a review of their data, they noted that approximately 70% of their revenue was actually being generated by 20% of their clients. Therefore, to support them, they set up a dedicated office for large taxpayers that provide premium services. This office provides dedicated relationship managers for each of the payers.
  • Communication campaigns: To widen their tax base, the Directorate of Revenue Collection has also instituted a number of communication campaigns. These focus on helping the taxpayer understand why paying taxes is important to the city and how their taxes are being spent. After seeing an increase in voluntary compliance, these targeted communications and overall taxpayer engagement have been streamlined within the Directorate’s annual plans. (It is difficult, however, to discern exactly what percentage of the overall increase in revenue can be attributed to improved communication with taxpayers.)

Revenue compliance strategy


  • 5 Ibid.
  • 6 Liam Taylor, “How One African City Is Flipping the Script on Urban Development,” ICTD, 2016,