Automation and customs tax administration: Empirical evidence from Uganda

Abstract

Automation is a topic that has soared in importance particularly on the efficiency of custom tax administration. This
paper investigates the adoption of automation by Uganda Revenue Authority (URA), a semi-autonomous agency
mandated with tax administration in Uganda. The adoption of automation in URA was aimed at achieving efficiency
and increase revenue. The paper reports findings based on cross sectional approach to investigating URA’s
experiences with automation, efficiency and effective tax administration. The evidence suggests a positive
correlation of automation and the cost of tax administration, automation and effectiveness of revenue collection
while automation was negatively and significantly related with tax clearance time. The paper makes significant
empirical contribution to analysing tax automation and administration cost, time efficiency and effectiveness of
revenue collection. Some of the results are inconsistent with the notion that automation leads to efficiency in tax
administration.