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The Impact of Digital Infrastructure on Tax Administration Efficiency: Evidence from URA

This study explores the role of digital infrastructure in enhancing the efficiency of tax administration at the Uganda
Revenue Authority (URA). With the growing importance of digital transformation in modernizing public sector
services, this research examines how URA’s digital platforms impact key areas such as operational costs, tax
compliance, and communication between URA and taxpayers. The study employs a quantitative research design,
with primary data collected through a structured survey from 31 respondents, including taxpayers, tax consultants,
and URA staff, achieving a 100% response rate. The survey gathered information on respondents' perceptions of the
digital infrastructure’s effectiveness, focusing on its accessibility, user-friendliness, and overall impact on the
efficiency of tax-related processes. The data were analyzed using descriptive statistics, such as mean scores,
standard deviations, and Pearson Correlation analysis to identify trends, relationships, and patterns within the data.
The findings reveal that a significant majority of respondents perceive URA’s digital infrastructure as effective in
improving the efficiency of tax administration, particularly in streamlining processes, reducing operational costs,
and enhancing communication. However, the study also highlights several challenges, including difficulties in
accessing digital platforms, varying levels of digital literacy, and occasional system downtimes, which continue to
hinder the full potential of digital infrastructure. Furthermore, a moderate to strong positive correlation was found
between improved digital infrastructure and enhanced communication between URA and taxpayers. The study
concludes that while digital infrastructure has led to positive outcomes, addressing issues such as accessibility,
system efficiency, and digital literacy is crucial for maximizing its potential. Recommendations include expanding
digital literacy programs, optimizing the digital platforms for a smoother user experience, and ensuring equitable
access for all taxpayers, particularly those in underserved regions. Future research should focus on identifying
specific barriers to access, understanding the long-term financial implications of digital transformation, and
exploring ways to further improve the sustainability of URA's digital infrastructure.

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