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Another 4 URA Officers Arrested

By Vision Reporter

Added 6th June 2002 03:00 AM

STATE House and other investigators have smashed a Uganda Revenue Authority (URA) racket which has allegedly been aiding purported exporters to receive cash payments under the export tax refund policy.

STATE House and other investigators have smashed a Uganda Revenue Authority (URA) racket which has allegedly been aiding purported exporters to receive cash payments under the export tax refund policy.

STATE House and other investigators have smashed a Uganda Revenue Authority (URA) racket which has allegedly been aiding purported exporters to receive cash payments under the export tax refund policy. Yunusu Abbey Reports that four senior URA officials, one of them a commissioner, were arrested in Kampala yesterday in connection with the fraud. The suspects allegedly caused a sh338m loss to URA but a March 4 audit report said up to sh2.5b could have been lost under the policy called the Duty Drawback refund. Those picked up were Martin Feta, commissioner large tax payers’ department, Felix Odong Kar and Sam Manana, both assistant commissioners for audit under duty drawback division and Paul Tumuhairwe, a principal revenue officer. Two other suspects are yet to be apprehended. Under the duty drawback policy, duties paid on inputs for production of exports are refunded to make them competitive. For instance, if one imported sugar for production of biscuits, he can register with URA and claim for duty drawback to recover taxes paid on the imported product. The arrests follow a probe jointly conducted by State House, the CID and URA auditors. The team visited Vurra, Ishasha, Malaba and other border points where the purported exports are alleged to have passed. “Over all, URA has suffered a financial loss of sh338,543,640. But the loss is likely to rise to sh2.5b. This has been caused mainly by failure on the part of the duty drawback desk to submit claim forms to the Customs Department for vetting. This appears to be a deliberate effort to cause a financial loss to URA,” the audit report, dated March 4, 2002, said. “The duty drawback auditors should show cause why disciplinary action should not be taken against them for causing financial loss to URA. The accounts on which the funds were banked should be established and steps should be taken to recover the money,” the report said. “Those found to have benefited from the funds should be prosecuted. The clearing agents mentioned should be investigated,” it said. The New Vision has learnt that the investigators have unearthed nine suspected fictitious companies which got “refunds” for non-existent locally manufactured export goods. The firms are Kyamu Agencies, Musco Enterprises Ltd. Epoget Iteso Agencies Ltd., Business Enterprises, USIA Wholesalers Ltd., Ngambo Agencies Ltd., Mwesa Distributors, Capital International Ltd. and Wabushere Trading Stores. The report said payment was mainly made between January and December 2001. But the probe covered the periods September 2000 to November 2001. On January 2, Wilson Othieno, the commissioner for finance and administration, wrote a memo to Annebritt Aslund, the URA Commissioner-General, listing the nine companies which he said falsely claimed sh338m. Othieno gave a breakdown of amounts paid to each of the nine firms, cheque numbers and dates. Musco Enterprises Ltd. claimed to have exported 400 mattresses, 1,200 cartons of edible oil and several others under export No. ML10/09/01/E1-0139 on a truck No. UAA 516P/873 UBS. The company said the exports passed through Vurra customs post on the Uganda-DR Congo border and were issued with an Outward Rotation No. VU/015/10/01. Musco Enterprises was paid sh20.7m on cheque No. 048987 with a voucher dated November 22, 2001. But on a recent scrutiny, the investigators discovered that it was a fake transaction. In another false duty drawback claim, Musco Enterprises was paid sh33.9m on cheque No. 027172 attached on a voucher of October 3,2001. It received another sh36.2m made on cheque No. 019055 with a voucher dated August 1, 2001. USIA Wholesalers Ltd. also purported to have exported 1,500 cartons of milk biscuits, 200 cartons of toilet paper, 4,500 cartons of pre-painted iron sheets gauge 30 and many others. It was paid sh34m for the purported export. The sh34m payment was on cheque 027102 attached on voucher of August 28, 2001. USIA Wholesalers alleged to have ferried the goods through Vurra. Business Enterprises informed URA it had exported 1,450 cartons of milk biscuits, laundry soap (500 cartons), cooking oil (1,800 jerrycans), 3,000 pieces of prepainted iron sheets and many other goods. URA subsequently paid Business Enterprises sh35.6m as duty drawback refund for the alleged exports. Other payments made to Business Enterprises were sh34m, sh31m, sh36m and sh22m. Ends

Another 4 URA Officers Arrested

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