Uganda tax collector bears down
KAMPALA, Uganda – Between July 2014 and June 2015, Uganda Revenue Authority (URA) has recovered over Ush 26 billion (about $8.1million) of the Ush36 billion ($11.2 million) from people trying to avoid paying taxes on goods
The money is from 5236 seizures. This represents a 21.9% increase in overall enforcement revenue recovery from last year’s Ush20.4 billion.
An Assistant Commissioner, Enforcement, URA James Kisaale said last week, “I am excited to report that as enforcement, we are doing our job in helping Customers recover all the revenue that it’s losing in tax evasion tactics. We are more alert now especially with the new electronic cargo tracking system and the coordination between different clearing agencies.”
He was holding a news conference during which he said the increase in the amount recovered compared to last year is attributed to the improved tracking methods and the alertness of the enforcement workers. URA is trying to reach its set target of Ush11.6 trillion (about $3 billion)
“Over 9.4billion (about 36%) was recovered undervaluation of goods where traders present a lesser value than the real value of goods they are importing. Outright smuggling accounted for 13.4 %( over 3.5%), false declaration or misdiscription of goods and services accounted for Ush8.4billion while Ush4.1b and Ush4.3billion was recovered from concealment and other offenses respectively.
The top risky goods that were involved in these fraud cases included motor vehicles, motor cycles, mobile phones, rice, garments wheat flour, hardware and electrical.
A total fraud value of over Ush 5.6billion shillings was captured by URA, of this URA has recovered Ush537 million. The total amount of hard ware smuggled was valued at 1.1billion shillings, 638 million has been recovered.
“Motor vehicles are among the goods that are being smuggles most. A few months back, we recovered a number of foreign registered vehicles from Sudan and good in operation clean up Uganda. We recovered over Ush537million from the total of 39 vehicles and we are yet to recover over more Ush1billion from the 49 remaining cars which will be auctioned to the public in a few days,” Kisaale said.
Kisaale noted that smugglers are taking advantage of the bodies’ reluctance in checking diplomatic cargos and are occasionally using them to smuggle goods into the country. Also traders are taking advantage of the free export taxation system and are actually diverting goods produced for export and selling them in Uganda hence causing the body losses as the same party go ahead to claim vat on exported goods. Among exports diverted include hardware items like cement, steel products and iron sheets. The high price of the dollar against the shilling could also be the reason for increased smuggling.
“Of course the falling value of the shilling is also responsible for the increase in tax evasion. The cost of importing goods is becoming higher because traders need more shillings to get a few dollars. That raises the cost of doing business and the taxes payable hence some traders are looking for any possible ways to invade taxes. However I would advise traders not to because when we catch you, you will pay the penalties. There is a lot to lose,” Kisaale said.
The commission also warned banks and the general public about cases of commercial fraud where some fake companies use banks and names of genuine companies to order for goods mainly chemicals used in making foods, juices and soaps from other countries and later disappear without paying.
“Most of the banks and import companies have been affected. These thieves have agents in banks and clearance companies who clear them and import goods on credit without the knowledge of both parties and when it’s time to pay, the owner of the goods come to these banks demanding to be paid. We ask the general public to be vigilant and watch out for these culprits,” Kisaale warned.
