Rédaction Africa Links 24 with The Observer
Published on 2024-04-17 03:34:34
The ongoing dispute between the Uganda Revenue Authority (URA) and city traders, represented by various associations such as the Kampala City Traders Association (KACITA), Uganda Cargo Consolidators, and Kampala Rice Traders, has been a focal point of contention over the past three weeks. At the heart of the disagreement is the enforcement of the Electronic Fiscal Receipting and Invoicing Solution (EFRIS), which has been mistakenly regarded by some traders as a new tax imposition.
Designed to monitor value-added tax (VAT) payments and facilitate accurate record-keeping for business transactions, EFRIS aims to simplify VAT collection. Despite its intended benefits, the implementation of this system has faced resistance from the business community. This has led to major protests, with shops being closed in areas like Kikuubo and downtown Kampala. Traders have raised concerns about perceived double taxation, lack of information regarding EFRIS’s operation, and the high implementation costs associated with modern technological tools required for compliance.
A memo to traders calling for a four-day nationwide demonstration against EFRIS highlighted the need for the system to target manufacturers and major suppliers rather than small businesses. Traders argue that high import values and the escalating cost of living are making essential goods unaffordable to the average consumer. Additionally, recent tax proposals from the ministry of Finance, Planning, and Economic Development, such as levying excise duty on various products and increasing taxes on fuel, have further fueled discontent among the business community.
Regarding EFRIS, the Uganda Revenue Authority conducted extensive workshops and established a tax hub to educate businesses on the system. To address the affordability of computers for EFRIS software installation, URA developed a smartphone application for issuing receipts. The high rates of registration for EFRIS among businesses with significant turnovers indicate a growing acceptance of the system. EFRIS has streamlined VAT collection processes and contributed to increased technology adoption among businesses.
In a meeting with city traders prior to planned demonstrations, URA agreed to suspend the protests and focus on awareness campaigns about EFRIS. The tax authority committed to providing support services to businesses, including assistance with new technology adoption and tax-related inquiries. URA emphasized the importance of voluntary compliance and urged the business community to embrace change and new technologies.
The Commissioner General of URA, John Musinguzi, highlighted the benefits of EFRIS in simplifying tax return processes and reducing the need for accountants. He emphasized the importance of educating the public about EFRIS to dispel misinformation and encourage voluntary compliance. Secretary to the Treasury, Ramathan Ggoobi, emphasized the non-negotiable nature of EFRIS as a tool for accurate tax collection and revenue generation.
City traders have expressed concerns about the high tax burden, increased competition from foreigners, and rising costs of goods. They have called for clearer government policies on taxation and pricing to address issues of exploitation and unfair competition. The traders’ frustrations with tax policies and implementation have led to demonstrations as a means of voicing their grievances and seeking solutions to the challenges they face.
The ongoing dispute between the URA and city traders underscores the complex relationship between tax compliance, technological adoption, and economic challenges facing businesses in Uganda. As both parties seek to address their concerns and find common ground, the need for constructive dialogue and collaboration remains essential to resolve the issues at hand.
Read Original article on The Observer
