Ura, Taxes and Doing Business in Uganda

The Uganda Revenue Authority (URA) is a government revenue collection agency established by the Parliament of Uganda. Operating under the Ministry of Finance, Planning and Economic Development, the URA is responsible for enforcing, assessing, collecting, and accounting for the various taxes raised in Uganda.

URA’s headquarters is located in a 22-storey skyscraper, known as Uganda Revenue Authority House (URA Tower), located at Plot M 193/4 Kinnawataka Road, Nakawa Industrial Area, in the Nakawa Division of the city of Kampala, Uganda’s capital and largest city. This is about 6.5km by road, east of the city center.

On 29th March 2020, President Yoweri Kaguta Museveni appointed John Musinguzi Rujoki as Commissioner General. He replaced lawyer Doris Akol who was appointed on 27 October 2014 by then Ugandan Finance Minister Maria Kiwanuka. To accommodate the majority of its staff in one location, URA built the 22-storey tower adjacent to its headquarters at Nakawa, completed in 2018, and officially commissioned in January 2019.

Taxation in Uganda

Taxes in Uganda are centrally assessed and collected by the URA, headed by the Commissioner General. Within the organisational structure of URA, two operational departments (Domestic Taxes and Customs) headed by Commissioners are directly responsible for the assessment and collection of revenues resulting from the tax laws below:

1. Customs Tariff Act, Cap. 337;

2. East African Customs Management Act;

3. East African Excise Management Act;

4. Excise Tariff Act, Cap. 338;

5. Income Tax Act, Cap. 340;

6. Stamps Act, Cap. 342;

7. Traffic and Road Safety Act, Cap. 361;

8. Value Added Tax Act, Cap. 349;

9. Finance Acts (Various);

10. Gaming and Pool Betting (Control and Taxation) Act, Cap.292;

Excise Duty

This is a tax that is imposed on specified imported or locally manufactured goods, and services. Essentially it is a tax on “luxury” items. The applicable rates may be specific or ad valorem. The tax is imposed on the value of the import; and in the case of locally manufactured goods, the duty (local excise duty) is payable on the ex-factory price of the manufactured goods. Exported locally manufactured goods are exempt from excise duty. Persons supplying excisable goods and services are required to register and file monthly returns to the tax authority by the 15th day of the month following the month in which delivery of the goods was made.

Documents for importation of goods

The following import documents may be required for purposes of making a declaration to customs:

1. A bill of lading or airway bill.

2. An insurance certificate.

3. Pro-forma invoices.

4. Commercial invoices.

5. A certificate of origin.

6. Permits for restricted goods.

7. Purchase order.

8. Parking list

 9. Sales contract

10. Any other supporting documents.

Customs Duty

This is a tax levied on goods imported (import duty) or exported (export duty) from Uganda at specific or ad valorem rates. The East African Community Customs Management Act 2004 (EACCMA) is the legal framework for customs operations in Uganda and the region as a whole. A customs union exists between the East African Community States of Uganda, Kenya, Tanzania, Rwanda, DRC, South Sudan and Burundi for the main purpose of promoting international trade between the partner states. The union operates as a single customs territory and trading bloc with a view to harness economic growth through a wider market for goods and services.

Valuation of imported Goods

Goods imported into the country from outside the EAC must be valued for taxation purposes i.e. a customs value must be determined. The customs value forms the basis for computation of customs duties which include import duty, Value Added Tax, Withholding tax, Excise duty and other duties e.g. environmental levy. Applicable tax rates are defined in the Customs External Tariff. Goods are valued using the following methods adopted by GATT (General Agreement on Tariff and Trade) and applied chronologically – 1) Transaction value. 2) Transaction value of identical goods. 3) Transaction value of similar goods. 4) Deductive value. 5) Computed value. 6) Fall back value.

Exportation process

Exports are zero rated tax wise to reduce costs for exporters and also make Ugandan products more competitive in the global market. The Export procedure by the agent and exporter is as follows-

1. Identify the operational export regime for the export. There are four (4) operational export regimes used in the automated export system, namely:

· EX1 Permanent Direct Exports. These are mainly local produce and attract no taxes.

· EX2 Temporary Export/ Re-exports (not bonded). Goods going out for repair or otherwise but coming back.

· EX3 Permanent Re-exports (not bonded). These are normally personal effects.

 · EX8 Bonded exports (CPC 8400)/ re-exports (CPC 8471). These are basically manufactured goods.

2. Make sure that Export Incentives and Facilities are ready. These are: –

· Bonded Warehouse Facility

· Duty Draw Back Facility

· Inward/Outward Processing

· Export Processing Zones (planning).

3. Capture a Single Administrative Document (SAD) at the DTI center, and registers the declaration.

4. Print the captured Single Administrative Document (SAD).

5. Attach all the necessary export accompanying documents and presented to Customs Verification Unit for confirmation of the export goods.

6. The Customs endorsed SAD is then lodged at CBC Exports Desk for document processing.

**All information can be found at https://ura.co.ug

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