Amuru, Uganda | When Uganda’s central go,vernment rolled out the Integrated Revenue Administration System (IRAS) in 2020, it was hailed as a milestone in the country’s digital transformation journey, a bold leap toward transparency, efficiency and accountability in local revenue collection.
IRAS was designed to replace the chaotic manual systems that for decades enabled corruption, revenue leakages and poor record keeping at the local level and it promised to make tax collection smarter and more citizen centered through a mobile and web-based platform that allows real-time tracking of payments, assessments and collections.
However, five years later, many urban leaders across Uganda say that while the system has curbed local corruption, it has also introduced a new bottleneck-digital centralisation that now threatens the financial autonomy of local governments.
Regina Bakitte Nakkazzi Musoke, Mayor Nansana Municipality revealed that many local governments including Nansana have faithfully embraced the automated system but the central government delays in sending back revenue collected by these local governments, hence it cripples many of the planned activities.
Her frustration captures a growing discontent among city and town mayors who say that although locreal-timees are collected electronically and remitted to the central government in real time, it can take months before those funds are returned for use on the ground.
The result of this are garbage piles up, street flood and public health risks soar even as millions of shillings are collected from market dues, property taxes and trading licenses still sit in central accounts.
“We are now running cities on promises, not cash. Our communities expect clean towns, working drainage systems and functional markets but we cannot plan or pay contractors if we do not know when the next release will come,” Bakitte lamented.
IRAS: A digital innovation with a human cost
IRAS developed with of Shs165,000m the Local Government Finance Commission (LGFC) and the Ministry of Local Government was launched as part of Uganda’s broader Digital Public Infrastructure (DPI) agenda – a drive to modernize governance through technology.
The system integrates registration, billing, payments and taxpayer education in one smartphonesence through its mobile application, citizens can panday fees and taxes without visiting municipal or city offices and reducing physical contact and potential corruption.
In principle, this digital approach reflects the same philosophy behind India’s Aadhaar identity system or Estonia’s e-governance platforms with all models of DPI aimed at improving state-citizen interaction.
However, Uganda’s experience is showing the limits of digital transformation without local control.
“What ,we are seeing with IRAS is a digital solution that has created new layers of bureaucracy. We collect our revenue on time but we wait too long for it to be remitted back for service delivery; this affects planning and implementation,” Sam Atul, Mayor of Lira City told this publication.
Atul further explained that urban leaders are expected to implement national laws such as the Public Health Act and Local Government Act, yet the tools to do so are either outdated or unsynchronized with the realities of urbanization.
“We are working with 1960s laws to govern 21st century cities; that mismatch, combined with digital centralisation, is a recipe for stagnation,” he said.
“The IRAS system itself is not the problem; it is how it is managed and with better coordination, it can be a tool for empowerment not frustration,” the mayor added.
Francis Lawoko, a produce dealer in Pabbo Town Council revealed that the IRAS system has made it easier for them (businessmen) to easily pay their dues directly and get instant feedback.
According to Lawoko, the system gives real time feedback making it easier for taxpayers to see the amount of money or revenue collected instantly on their smartphones.
“This system is good and it allows transparency; however, it does not debar officers from corruption because some of the officers may use the illiteracy level among the rural communities for their own good,” Lawoko noted.
Adding: “I love the interface of the system, it is easier to navigate and use. I am happy; I can pay my taxes and revenues at my finger tips.”
Geoffrey Odoch, an agro input dealer revealed that though the system has improved on the speed of tax payment and transparency; it is quite expensive in terms of poor network.
“I pay my license through the platform annually; but they charge too much. I usually pay an amount of shs165,000 by the end of October yearly,” Odoch said.
He further noted that the cost associated with the system is too much and for many rural business men and women, assessing the system on borrowed smart phones and laptops is a problem.
“Some business people and community members do not own or even know how to use smart phones; this makes it hard for them to pay their revenues in turn it affects the revenue basket of our local governments,” Odoch explained.
Digital transparency and fiscal insecurity
For years, local governments have been accused of mismanaging locally generated revenues with old manual systems enabling officials to under-declare collections, manipulate receipts and pocket cash without leaving a trace.
IRAS was meant to change all that and it has tried with the platform’s transparency making it difficult for local revenue officers to embezzle funds as all transactions are traceable and visible to both the Ministry of Finance and the LGFC.
However, Godfrey Innocent Onega, Chairperson of Paidha Town Council revealed that the same transparency has come at a cost and with the erosion of local fiscal autonomy.
“Every time we collect money, it goes straight to the central pool; we then have to wait for the center to send it back, meanwhile garbage trucks need fuel and residents are demanding clean streets,” Onega said.
Onega further explained that the delay not only undermines service delivery but also erodes trust between local leaders and the electorate.
“The people think we are lying to them; they pay their dues but when services are delayed, they blame us not the system,” Onega added.
In Paidha, like many small towns across Uganda, the mayor’s office receives daily complaints about uncollected garbage, unlit streets and stagnant drainage systems.
Onega cited that the community does not understand that the money they paid is stuck somewhere in the digital pipeline; however they want to see what it is doing in real time.
John Bosco Oryema, the Acholibur Town Council Chairperson painted a similar picture stating that while digital collection has improved accountability, it has also slowed down the responsiveness of local governments.
“The last release we received was in June last year; up to now we are still waiting for the next one, yet our community needs services from the local revenue we collected from them,” Oryema said.
He argued that the central government should allow towns and municipalities to access their locally raised revenue earlier for better planning.
“We are not against the system, but digital systems should not become cages that tie our hands,” he clarified.
The politics of digital public infrastructure
Uganda’s IRAS rollout is part of a broader push by the government to digitise service delivery and systems like IFMS (Integrated Financial Management System) for public finance, URSB’s digital business registry, and URA’s e-tax platform have all been hailed as steps towards transparency.
In 2009, in a bid to improve efficiency in tax administration and revenue collection, URA launched its e-tax portal and this move saw several processes such as TIN registration, tax return filing and tax payments migrate from a manual process to one done online.
However, analysts argue that the problem lies not in the technology itself but in how digital infrastructure is governed and yet these systems mainly concentrate control within central agencies raising questions about the balance between transparency and decentralisation.
“Digital systems are not neutral and they reflect the power structures of the institutions that control them. If local governments have no control over their digital tools then you have centralisation disguised as modernisation,” Dr Charles Ayita, an economic analyst revealed.
Ayita warned that if the current design of IRAS persists, it could reverse decades of progress in Uganda’s decentralization policy-a framework introduced in the 1990s to empower local governments to make fiscal and administrative decisions independently.
“What we are saying now is a digital recentralization of power; the system is efficient but efficiency without autonomy can be oppressive,” he said.
He further explained that technology is not a magic wand and without a governance framework that empowers local actors, digital tools will only automate inefficiency.
The Office of the State Minister for Northern Uganda acknowledged the complaints but said the problem had already been addressed.
“There was a big complaint a while ago about the IRAS but we were told in cabinet that it has been corrected; the monies remitted to the center are supposed to be sent back within one to two weeks,” an official who prefers anonymity revealed.
However, he noted that it is saddening to hear that local governments are still waiting months for disbursements and promised his office will take up the matter with the Ministry of local government.
The statement, though reassuring, underscores a deeper issue; the lack of real-time accountability in digital governance systems; while data may flow instantly, decisions about data still depend on human actors and bureaucratic processes.
Urban areas on the edge
Uganda’s cities and municipalities are on the frontline of change with rapid urbanization estimated at 5.6% annually; it is stretching infrastructure, housing and service delivery to the limit, yet local governments still depend heavily on central transfers which accounts for over 90% of their budgets in many cases.
“Cities should be the face of Uganda’s transformation; instead we are battling floods, garbage overflow, noise pollution and outbreaks of diseases like cholera-all because we cannot access our own revenue on time,” Bakitte said.
She further noted that urban leaders, many with limited academic backgrounds are still expected to plan and supervise technical teams without adequate resources; thus, given responsibility without the tools to succeed.
For cities like Gulu, Lira, Arua and Mbarara, the stakes are high and delayed garbage collection means increased health risks, blocked drainage leads to floods and neglected infrastructure scares away investors.
“Digital transformation must mean more than apps and dashboards; it must mean that when a citizen pays tax, they see a clean street, a working light or a functioning market-not a digital receipt that leads nowhere,” Bakitte noted.
Urban governance experts further argue that unless IRAS is adjusted to allow local retention of at least part of collected revenue, cities will remain reactive instead of proactive.
In India, for example, local governments are integrated into a national digital payment system but retain partial control over collections through state-level treasuries and in Estonia, local councils manage their own digital portals with interoperability across government systems.
Uganda’s journey toward digital governance reflects a paradox with technology making government more visible but not necessarily more responsive; thus, digitisation without decentralization can reproduce the same inequalities it seeks to solve.
Therefore, for mayors and town chairpersons, the IRAS has become both a symbol of progress and a reminder of the limits of local autonomy in a centralised state; hence, until then, Uganda’s IRAS will remain a lesson in how even the smartest systems can falter when technology outpaces policy and when digital progress leaves local governance behind.
As cities expand and citizens demand better services, the question is not whether Uganda should digitize governance since it is inevitable but how to ensure that digital systems like IRAS truly serve the people at the grassroots.
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