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Uganda loses $700m to smugglers

By Vision Reporter

Added 19th July 2011 03:00 AM

Uganda is loses up to 30 per cent of its annual tax revenues to smugglers, denying the country the much needed funds to grow, its taxman has said.

Uganda is loses up to 30 per cent of its annual tax revenues to smugglers, denying the country the much needed funds to grow, its taxman has said.

Agencies

Uganda is loses up to 30 per cent of its annual tax revenues to smugglers, denying the country the much needed funds to grow, its taxman has said.

Data released by the Uganda Revenue Authority shows the country could be losing as much as Ush1.8 trillion ($703 million) annually to smuggling even as the taxman struggles to fight fraud in import clearance.

Though URA efforts in enforcing tax compliance appear to be yielding results with increases in revenue collection, millions of dollars are still lost in uncollected revenue.

"In the past year, URA collected Ush6 trillion ($2.34 billion) in revenue. The revenue we collected from smuggled goods increased from Ush9.9 billion ($3.86 million) in 2009/2010 to Ush11.1 billion ($4.33 million) in 2010/2011. We estimate that Uganda loses 30 per cent of total revenue to evasion of taxes by traders," said James Kisaale, URA Assistant Commissioner in charge of Enforcement.

According to The East African newspaper, the report indicates that traders have found smuggling of unprocessed hides and skins without payment of export duties the most lucrative business.

Forty-six containers of hides and skins were impounded between July last year and June this year, leading to a tax recovery of Ush1.65 billion ($644,500).

In the same period, collection of export levy on hides and skins increased from Ush120 million ($46,900) in 2009/2010 to Ush7.39 billion ($2.9 million).

URA also impounded 30 million cigarette sticks smuggled from the Democratic Republic of Congo and Southern Sudan. From the cigarette seizure, the taxman recovered Ush1.5 billion ($585,900) in taxes.

Uganda loses $700m to smugglers

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