The Uganda Free Zones Authority (UFZA) and the Uganda Revenue Authority (URA) have signed a memorandum of understanding, aimed at improving the business environment for investors in the free zone parks.
According to the UFZA executive director, Richard Jabo, the MOU will integrate and link UFZA to the tax man’s electronic cargo tracking systems, to ensure safety of goods and raw materials into the country.
“Through this partnership, URA will also offer us technical assistance in the development of cargo and warehouse management systems which are crucial for any large manufacturing zone, such as the ones we are developing,” he said, after the signing of the MOU at the URA Head Office in Nakawa, Kampala on Friday.
He said URA will fast-track customs clearance of raw materials and other imported inputs destined for free zones, as well as avail customs officers to supervise and control access, entry and exit points in the free zone.
The taxman is also expected to Issue tax clearance certificates and certificates of compliance in fulfilment of the conditions for performing customs supervision in a free zone, Jabo said.
A free zone is a designated area where goods are regarded as being outside the customs territory, as far as import duty is concerned.
It usually takes the form of manufacturing or processing facilities, science and technology parks or even a tourism development zone.
URA commissioner general Doris Akol said it is important for government institutions to partner in providing services, to avoid duplication of work and time wastage, which frustrates investors.
She said URA is responsible for supervising and controlling customs-related activities within free zones in Uganda and issuing certificates for customs supervision in the zones.
“And for this reason, URA will facilitate fast tracking of customs clearance of raw materials and other imported inputs destined for free zones at border posts and other customs clearance points” Akol said.
On its part, the free zones authority will keep an accurate record of all plant, machinery, equipment, raw materials and goods manufactured in a free zone.
UFZA is also mandated with ensuring that no retail trade is carried out without permission from URA, and ensuring that free zones developers avail office space, scales and measures for examining and taking account of goods.
Jabo said Investors who manufacture from within the parks will be exempted from import duties for raw materials, and will also benefit from unrestricted remittance on profits after tax.
The free zones authority created eight free zone area parks across the country, help government in promoting export of goods and services, promote investment from local and foreign sources, and also accelerate export led industrialisation.
“The parks are meant to attract more investors in the industrial sector, boost production especially for the export market, and also create more jobs needed for our economy, and this MOU will help to speed that up,” he said.