Court blocks sh280m Nissan tax
Sep 11, 2009
THE Commercial Court has stopped the Uganda Revenue Authority (URA) from collecting over sh280m tax from Nissan (U) Limited until its case is finally disposed of.
By Hillary Nsambu
THE Commercial Court has stopped the Uganda Revenue Authority (URA) from collecting over sh280m tax from Nissan (U) Limited until its case is finally disposed of.
Justice Lameck Nsubuga-Mukasa ruled on Monday that URA should not enforce the judgment of the Tax Appeal Tribunal in which it had ordered Nissan to pay over sh280m as VAT.
This followed submissions by Enoth Barata, who represented Nissan, in which he said the company had appealed against the ruling.
He submitted that until the company’s appeal was finally decided, it would not be just and equitable to allow the tax collectors enforce the ruling.
Barata also argued that if URA was not stopped from collecting the tax, the company’s appeal in the High Court would be rendered useless.
“If the URA is not stopped from collecting the alleged tax, the company will suffer irreparable loss of its monies in such huge sums and it would be very difficult to recover them,†Barata submitted.
He argued that being one of the suppliers to most donor-funded projects, Nissan had been exempted from paying taxes on vehicles supplied to various government ministries.
“Taking the claimed VAT would curtail Nissan’s business operations in the country and the monies would not be refunded if the company eventually qualified for the waiver,†Barata argued.
However, Charles Ouma, URA’s legal officer, had opposed the application, arguing that URA would refund the money that would be found to have been wrongfully assessed for the company to pay.
He said Nissan would get a refund if their appeal was successful and requested court to dismiss the application with costs.
Nissan sought a judicial review of URA’s tax assessment because the alleged taxes emanated from its supplies of motor vehicles to various government projects on the ex-bond basis, which were tax-free.
It was further argued that the 2009-2010 budget-speech by the finance, minister Syda Bumba, also exempted the company from paying VAT on the motor-vehicles it supplied to donor-funded projects.
Nissan supplied vehicles to projects in the agriculture, education and health ministries.
THE Commercial Court has stopped the Uganda Revenue Authority (URA) from collecting over sh280m tax from Nissan (U) Limited until its case is finally disposed of.
Justice Lameck Nsubuga-Mukasa ruled on Monday that URA should not enforce the judgment of the Tax Appeal Tribunal in which it had ordered Nissan to pay over sh280m as VAT.
This followed submissions by Enoth Barata, who represented Nissan, in which he said the company had appealed against the ruling.
He submitted that until the company’s appeal was finally decided, it would not be just and equitable to allow the tax collectors enforce the ruling.
Barata also argued that if URA was not stopped from collecting the tax, the company’s appeal in the High Court would be rendered useless.
“If the URA is not stopped from collecting the alleged tax, the company will suffer irreparable loss of its monies in such huge sums and it would be very difficult to recover them,†Barata submitted.
He argued that being one of the suppliers to most donor-funded projects, Nissan had been exempted from paying taxes on vehicles supplied to various government ministries.
“Taking the claimed VAT would curtail Nissan’s business operations in the country and the monies would not be refunded if the company eventually qualified for the waiver,†Barata argued.
However, Charles Ouma, URA’s legal officer, had opposed the application, arguing that URA would refund the money that would be found to have been wrongfully assessed for the company to pay.
He said Nissan would get a refund if their appeal was successful and requested court to dismiss the application with costs.
Nissan sought a judicial review of URA’s tax assessment because the alleged taxes emanated from its supplies of motor vehicles to various government projects on the ex-bond basis, which were tax-free.
It was further argued that the 2009-2010 budget-speech by the finance, minister Syda Bumba, also exempted the company from paying VAT on the motor-vehicles it supplied to donor-funded projects.
Nissan supplied vehicles to projects in the agriculture, education and health ministries.