Uganda Revenue Authority has said it will invest in consumer
sensitisation and education to help the public understand the Digital
Tax Stamp system.
Speaking at a dialogue on digital tracking
solution in Kampala on Tuesday, Mr James Odongo, the URA assistant
commissioner for domestic taxes, said the Digital Tax Stamp, which was
introduced in October last year and implemented on Nov 1, 2019 will not
only help URA to improve its collection efficiency but also reduce the
supply and entry of counterfeits.
“It is an administrative
measure to help monitor counterfeits,” he said, noting the move was not
in any way seeking to burden manufacturers.
Digital Tax Stamps are
physical paper stamps with security features and codes. They are applied
to goods or their packaging to enable manufacturers and traders to
track a product’s movement. This will enable the government to easily
monitor tax compliance.
This is in addition to quick response code (QR code) that will allow distributors, retailers, and consumers to use an app on their smartphones to verify the authenticity of the products.
The new stamps solution is part of URA’s scheme to combat illicit trade, close revenue leakages while managing compliance of some multinational companies that exploit gaps and in the tax collection architecture.
According
to Uganda National Bureau of Standards, at least 58 per cent of goods
on the Ugandan market are counterfeits, which presents risks to
consumers and the economy.
However, during the same forum, activists
against substandard goods and counterfeits under Anti-Counterfeit
Network challenged URA to explain how the tax will stop the entry or
manufacture of fake goods.
Mr Fred Muwema, the Anti-Counterfeit
Network director legal and corporate affairs, said whereas they welcome
Digital Tax Stamps, there was need for URA to explain what it seeks to
achieve and how the tax will be implemented, benefits to consumers and
how it will get rid of counterfeits.
“We are here to deepen our
understanding of digital tracking solutions. We went to court
challenging URA’s deadline to prosecute and arrest people without the
tax. URA should explain to all of us what they want to achieve and how
it will be implemented,” he said.
Advertisement
URA has previously said goods in the category of water, soda, beer,
spirits and cigarettes, among others will be required to bear Digital
Tax Stamps, failure of which distributors or manufacturers of such goods
will be penalised.
The stamps are obtained through installing digital tax system equipment at such factories.
Digital Tax Stamps are still a controversial subject with consumers saying they are likely to increase the cost of business.
