Improving Tax Compliance in Uganda

Guest blog written by Doris Akol

My previous experience with public policy has hitherto been mainly as a formulator of organizational policies which are then implemented by other units and more recently as a first hand implementer of fiscal policies passed by the Government for revenue collection. Frankly speaking, I had never quite addressed my mind to that fact that the process of implementing public policy is akin to being on a rollercoaster of thrilling adventurous fast paced rides, being stuck on a cliff and sometimes being dropped off that cliff (when the policy creates a backlash during implementation).

Eight months ago, I started on a process of walking the public policy implementing journey. This started with a definition of the policy challenge I am facing for which a solution is required. I selected a challenge relating to improving compliance for taxes, especially in the informal sector of our economy.

Reporting for the in-person training at Harvard was like a dream come true in itself…. I mean, this was me at Harvard! Meeting accomplished and likeminded professionals from all over the world, all seeking answers to the question, “how does one successfully implement policies for impactful change” was another fulfilling experience. We were all looking to better our communities or other spheres of influence and make great impact though public policy.

I learned that, policies are a response to a problem or the perception of the existence of a problem. It is in the process of understanding the gap between the existing (status quo) and the ideal situation that a public problem may be identified. This then sets off the thinking process of how the situation may be moved from existing to ideal i.e., how the gap may be closed. This process will elaborate the steps that may need to be taken, the resources that will need to be deployed and the persons/ institutions required to take action in order for the problem to be rectified or mitigated. The end product of the process will most definitely be a policy.

I also learned that for successful policy implementation, it is key to obtain acceptance, especially from authorizers…those power holders with a big “P”, who are likely to ensure your policy implementation is supported, such as bosses or financiers, and those power holders with a small p, who may frustrate the implementation of the policy because they wield power with other influencers. In public policy implementation, it is crucial to identify all those that wield some form of power, overt and covert and seek to bring them along in order for the policy to succeed.

The importance and value of negotiation cannot be underscored enough in getting people to come along. As Matt Andrews said often, it is important to get more people to care about the problem.

While at Harvard, we went through a process of problem definition and /or refining. We learnt about the Ishikawa model, or ‘Fishbone’ diagram that enables root cause analysis of a problem. Root cause analysis ensures that solutions are found for the actual cause of a problem and not for the manifestation or symptom of the problem. Adapting the Fishbone model to my policy challenge of low tax compliance, one of the root causes identified was the low tax morale and compliance culture, caused among others by a large informal sector and low levels of financial literacy.

In addressing the policy challenge successfully therefore, it was imperative to identify an appropriate intervention point.

fishbone diagram 

I chose the problem of poor financial literacy as my intervention point because I felt that it would give us some quick wins.

Waterfall vs. Agile

The implementation process may take a ‘waterfall’ approach if the environment and other surrounding ecosystem factors are certain. This would typically follow the Gantt chart or log frame approach. However, in practice, there usually are uncertainties that crop up. This requires an iterative, learning, unlearning and relearning process. PDIA, which is Problem Driven Iterative Adaptation is an iterative learning and adaptation model that enables solutions to be found for each problem that crops up, based on the lessons that are picked up along the implementation journey. This not only makes the solution appropriate but ensures not only functional success but also legitimacy success for the policy implementation.

Adapting PDIA, to my policy challenge

On return home, whereas I thought that addressing the low tax compliance by developing financial literacy centered tax payer education programs would provide a policy solution, I quickly discovered that my team did not agree with me. In fact, they were quite insistent about addressing the issue through inculcating a compliance culture in the younger generation of future taxpayers. These were my small ‘ps’ calling the shots and I realized that if I wanted to progress into finding a solution, I would have to move along with their idea, otherwise we risked not progressing at all. PDIA fully at work!

In deference to my team I re- engaged  through another  entry  point in order to make progress. This involved design of a tax literacy curriculum that will soon be introduced in schools and universities as part of the wider tax education  and financial literacy programs for the informal sector. And thus started the journey towards theproject called “Building a Tax Alert Generation”.

We have registered tax clubs in secondary schools and tax societies in Universities and these will be focal points for dissemination of tax information and education campaigns alongside formal teaching of a tax subject in the school syllabus.

With the change in focus, I found that the entire team was now more enthusiastic and supportive of the new policy intervention and this has given us more speed and trust in delivering on the assignment.

group photograph

With the curriculum developed and signed off internally, the progress slowed down because of a dependency on an external government authorizer that must sign off the curriculum content before it can be launched. This is still work in progress.

In the meantime, we have held school debates at universities, organized by the university tax societies, on subjects that create awareness and learning about the importance of paying taxes to the survival of nations.

group photograph

Lessons learned

Coming up with the policy challenge was the easy part…. Distilling what the actual challenge for appropriate intervention and for determining the correct entry point for me was quite hard as it caused me to question myself about whether this would bring about the desired outcomes.

The next level of difficulty came from aligning authorizers to ‘my’ cause and getting them to think in the same way and see things from the same or similar perspectives. In fact in my case, I had to step away from my intended plan of action and adopt a new plan of action in order to move the implementation interventions along. I quickly realized that if I was to get my team – who were now authorizers – signed on, I needed to adjust my thinking to their thinking. This was a real learning point for me and PDIA in action I believe.

Finding the time to work on the policy challenge amidst a very busy work schedule that involves both local and international travel was for me a real difficulty. I have had to keep “re- engaging with myself” on why I must keep my eye on the ball and see the developing interventions through. The motivation for keeping at it came from reminding myself of the “why” behind the selection of the policy challenge….. The bigger picture of increasing tax compliance generally through deepening and reinforcing a tax compliance culture.

I believe that we are firmly on course to completing this assignment as planned. Am also gratified that already we have heightened awareness among the adolescents and young adults about taxes and tax compliance and I believe this will carry through into their entrepreneurial years and exploits. So we are building a tax compliance culture one young future taxpayer at a time.

To quote Matt Andrews, PDIA is hard work but it is worthwhile because ultimately, we are all on this journey to make a difference and to bring desired change to our communities. The fact that someone’s life is improved because of the effort I have made whatever small is what for me, makes successful public policy implementation specifically and public service generally, very fulfilling.

This is a blog series written by the alumni of the Implementing Public Policy Executive Education Program at the Harvard Kennedy School. Participants successfully completed this 7-month blended learning course in December 2019. These are their learning journey stories.

To learn more about Implementing Public Policy (IPP) watch the course and testimonial video, listen to the podcast, and visit the course website.

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