Uganda’s possibility to fund fully it’s budget in years to come

Abstract

Government Expenditure is considered among the leading debates taken not only in developing countries but worldwide as well. Empirical investigation on the linkage between local revenue and external revenue is considered important. The study aims to determine the relationship between local and external revenue on government expenditure of Uganda. Data used in analysis was covering the period 2010-2022. The study applied Ordinary Least Square (OLS) multiple regression analysis, to investigate the relationship among variables. The study findings signify a positive and significant relationship between external revenue and expenditure. Whereas a negative and insignificant relationship was observed between local revenue and government expenditure. Study there for recommend government that Budget re-prioritization is critical in the quest for building the capacity to fully fund the national budget. Productive ventures should receive more funding - education, industry and health for example should receive more funding, and this should be financed by reducing expenditure on defense and luxurious remuneration for public servants among other wasteful endeavors by the government. With this, long term benefits from a human capital rich and healthy population as well as a flourishing industrial sector - in terms of increased innovation, investment and private sector qualitative expansion can be enjoyed through a broadened tax base and reduced expenditure on subsidies.