Taxman, UNBS partner to address illicit trade

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The Uganda Revenue Authority (URA) and the Uganda National Bureau of Standards (UNBS) have reaffirmed their commitment to addressing the challenge of illicit trade, saying it is not only a tax issue but also a national concern.

The two agencies pledged during the recently concluded Second Annual Regional Industrialisation Conference, organised by the private sector under the theme: Enhancing policy advocacy for sustainable regional industrial growth.

Speaking during the conference, URA’s tax enforcement manager, Moses Kyomuhendo, said the taxman has started leveraging technology such as digital tax stamps to improve product traceability, particularly in excisable goods like tobacco, alcohol and soft beverages, many of which previously went untracked.

Kyomuhendo emphasised that illicit trade undermines public safety, weakens legitimate businesses, and deters both local and foreign investment. He said URA is working to engage and formalise small-scale manufacturers, including the growing number of soft drink producers, to bring them into compliance and out of the informal market.

“The goal is clear: to ensure every player in the manufacturing sector is aligned and contributing to a fair, safe and competitive economy,” he added.

Digital tax stamps are advanced technology tools embedded with unique security features that enable the tracking and verification of goods. The stamps are applied to products by manufacturers or importers and contain digital information that can easily be accessed by both authorities and consumers using scanners or mobile applications.

UNBS executive director Eng. James Kasigwa said the bureau will continue to utilise the track-and-trace system, raise consumer awareness, conduct market surveillance, and carry out import inspections to facilitate legitimate trade. Kasigwa called on enterprises and the public sector to self-regulate by committing to the production of quality goods and services. He urged consumers to demand and buy only certified, good-quality products.

“The fight against illicit trade is not for government regulators alone. It is for the industry, consumers and the general public. We need to build a national quality culture,” Kasigwa said.

To further support the fight against substandard products and illicit trade, UNBS introduced the digital conformity marking (DCM) programme. The programme provides a track-and-trace mechanism for consumers, supermarkets and retail outlets to distinguish between certified and substandard commodities.

The DCM programme issues digital conformity marks to certified goods, offering consumers proof that the products meet applicable standards and are safe for consumption.

“These stamps contain information such as product details, the standard under which it is assessed, certification date, batch number, and manufacturer’s name. Supermarket owners, consumers and the public can use the Kakasa app to scan these stamps and verify certification,” Sylvia Kirabo, the UNBS head of public relations and marketing, said.

Kasigwa called on enterprises and the public sector to self-regulate by committing to the production of quality goods and services.

Illicit Trade

Reports show that illicit trade is particularly common in alcohol, bottled water, cigarettes, steel products, detergents, electrical appliances, cosmetics, pharmaceuticals, agrochemicals, computer software and hardware spare parts.

According to URA, the country lost more than sh91b in 2022 to illicit trade, with recent industry surveys pointing to a worsening trend. In May this year, the Uganda Alcohol Industry Association released a report indicating that illicit alcohol accounts for 67% of the market, 2% higher than 2020.