All factories in Uganda must allow the company hired by the Uganda Revenue Authority (URA) to install digital cameras/solution in the production lines so as to capture output units for proper revenue assessment.
President Yoweri Museveni on November 18, 2019 directed Finance Minister Matia Kasaija, ordering that all factories must allow access for SICPA, a company hired by URA to install the cameras without further delay.
Museveni in in the letter to Kasaija says the electronic method eliminates fraud and wonders why SOME factories are afraid of the digital system, which he says will eliminate fraud in compiling tax revenue.
Museveni also wants URA to discuss with SICPA to add new software to its system to monitor income tax, which is not covered by the current agreement, saying URA should waste money buying new equipment.
He also wants the Prime Minister and officials from ministries of Finance, Health, Agriculture, UNBS to discuss how SICPA can help them to digitally monitor quality, prices and the location of the respective items.
Uganda Manufacturers Association (UMA) in late October wrote to Museveni pleading with him to put on halt the installation of the digital tax stamp solution and allow them more time.
Barbara Mulwana, the Chairman of UMA stated then that while manufacturers were not opposed to the implementation of the Digital Tax Stamp Solution, its members would like an extension of the implementation date announced in a public notice issued by the Ministry of Finance and URA.
The Digital Tax Stamp Solution was announced to begin on November 1, 2019 and according to URA, it would increase the monitoring of tax compliance by players in the beverage, alcohol and cigarettes sectors. Manufacturers have a three-month transition period to invite URA to install equipment at their factories.
In their letter they wanted Museveni to announce publicly that the government would take care of all costs associated with the installation of digital stamps solution. Now that wish has been granted by Museveni as the taxpayer will meet that cost.
It is anticipated that implementation of the stamps on selected products will help eliminate substandard products in the local market, put in place traceability mechanism and enhance revenue collection.
URA has installed on the excisable goods, management systems in production lines at a number of factories that belong to members of UMA including Harris International, Mukwano and Coca-Cola to monitor usage of digital stamps.
The Digital stamp solution according to URA is the latest method to have a clear view of how much tax should be expected from what is being produced.
Uganda becomes the 4th country in the region to take on the solution after Rwanda, Kenya and Tanzania adopted digital tax stamps solution and reported success in increased tax collection and immense reduction of counterfeit goods on the market.
