Indian Business forum meets URA

By Watuwa Timbiti

The Indian Business Forum (IBF) has held a meeting with the Uganda Revenue Authority in which the two bodies discussed ways they can undertake to improve their working relations in regard to matters of business and taxation.

“As the Indian Business Forum, we are willing to work together with URA to educate our small business houses to pay taxes timely and rightfully. Many times lack of knowledge/ ignorance leads to non-compliance,” said Rajesh Chaplot, the IBF secretary general during the meeting held at Kati-Kati on January 19.

Rajesh commended URA’s revenue collection last year, which exceeded the target, noting, however, that most businesses performed poorly due to the recession of the economy.

URA CommissionerGeneral, Doris Akol (left), Indian Business Forum Secretary General, Rajesh Chaplot, Sanjay Tanna (enter) the MP Tororo Municiplaity, and Vinay Dawda, the IBF vice-chairperson having a light moment shortly after Akol's arrival as other guests look on. PHOTO/Watuwa Timbiti

“The question arises how URA collected more taxes, when businesses were not doing well in the year 2014. This was due to URA widening their tax base,” he notes.

As a suggestion for more tax collection, Chaplot notes that there are certain markets in Uganda which can be called tax free zones, advising that URA should take necessary steps to include them into their tax base widening exercise.

Additionally, he says that the Indian community in Uganda is approximately 10,000-12,000 heads of family which is about 0.04% of the total Ugandan population, but contributes more than 60% to the government’s domestic revenue.

Chaplot equally requested that IBF is granted an advisory slot within URA.

“As the biggest stakeholder for tax contribution to URA, our Indian Business Forum would like to play an advisory Role with URA,” he suggests.

In his remarks, the Indian High Commissioner to Uganda, Ramesh Chandra, commended the URA team, which he noted comprised a fair number of women, arguing that the women were in the team not just for gender balance, but for good governance.

He, however, decried the ever rising cost of work permits for Indian business men in Uganda, saying that small businesses may not match such costs. “For instance, 12 months ago, the permit cost $2000. It is now costing $2500,” he notes.

During the discussions a number of issues such as delays in truck clearance and influx of smuggled goods, and what constitutes being tax-complaint.

“Smuggling is a big problem affecting us. I am a wheat flour dealer and there is a lot of smuggled flour in the country, which is cheap and yet we pay taxes. I realised that if I closed my mill and decided to deal on in trading in wheat flour I would make more profits,” notes Ashok Mishra, the chairperson of the Uganda Wheat Millers Association.

“IBF members equally complained of delays in services delivery, for instance, issuance of tax clearance certificates.  URA delays in issuing tax clearance certificates and every now and then we have to run there,” complained Nitin Hemani of Digiprint Systems.

Rajni Tailor, a senior Indian Association member and businessman complained of a significant section of the business community in Uganda that is going untaxed and yet they are making big profits.

“If you go to down town Kampala, you find people selling more goods than we do. They sell in a day goods worth between sh50m and 60m. However, they are not paying taxes; they do not want to be paid through the bank nor do they want to be paid by cheque, they want cash payments only. So their business records cannot be easily studied,” he notes.

Taylor equally complained that URA had not acted despite the various leads and evidence tendered to it to deal with the problem.

Responding to the queries, URA assistant commissioner Silajji Kanyesgye commended IBF for timely tax payment and cooperation, noting that efforts are being undertaken to make many more people pay tax.

“Yes there are so many people in Uganda’s cash economy and they are not paying tax. We are still working with KCCA , for example, to ensure that one does not get a trading license if they do not have a tax identification number (TIN)), he says.

In his closing remarks Michael Otonga, the URA commissioner corporate services, who also spoke on behalf of the commissioner general, Doris Akol, commended IBF for initiating and organising the meeting, noting that it was just the beginning for more future engagements.

“The next such meeting will be organised by URA. Our interest is to see you businesses grow and we only pick from you what is compulsory and if there is anything we can do to level the playing ground, let us know,” he advised.