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URA to Waive Penalties for Taxpayers Who Do Voluntary Disclosure

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The window for voluntary disclosure comes after an amendment of section 66 of the Tax Procedures Code Act, 2014. The amendment gives the URA commissioner general a discretion to ask taxpayers to voluntarily disclose and be forgiven on the penalties and interest on money they hadn’t paid.
URA tower in Kampala. PPU photo

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Uganda Revenue Authority - URA says it will waive penalties for taxpayers who will come out to voluntarily declare the taxes that they were supposed to pay but didn’t pay it.

The window for voluntary disclosure comes after an amendment of section 66 of the Tax Procedures Code Act, 2014. The amendment gives the URA commissioner general a discretion to ask taxpayers to voluntarily disclose and be forgiven on the penalties and interest on money they hadn’t paid.

In a note to the general public, URA says the voluntary disclosure must be in writing and “must be accurate and highlighting any previous inaccuracies.”

URA has not put a timeline of when amnesty will end. Vincent Seruma, the assistant commissioner for corporate affairs, said it remains open since the law allows it.

//Cue in; “the voluntary …

Cue out…advantage of that.”//

URA usually does audits to catch tax cheats. When one is caught, they pay heavy fines and interest on the money they had hidden from the tax body. The voluntary disclosure window means one avoids the audits.

Doris Akol, former URA boss and now a tax partner at law firm Dentons said on Monday that voluntary disclosure will only be complete when the taxpayer pays the principle tax that they’re declaring to have not paid before.

This means that if you make a disclosure to URA that you didn’t pay the tax you were supposed to pay, you should go ahead and pay that tax. Akol said one of the constituents expected to take advantage of this call is rental tax earners or landlords. The government has for long said landlords were evading to pay taxes.

//Cue in: “Rental tax…

Cue out…. Should have paid.”//

Last month, the government announced it was hiring an American company, RippleNami Inc to help in the collection of rental tax in Uganda. The company, the government said, would identify properties, their owners and link them to the URA tax identification number system.

Uganda’s tax-to-GDP ratio remains low at just 13 per cent with the wide belief that many people and businesses are not paying their fair share of tax to the government.

Voluntary disclosure is one of the initiatives that the tax collector wants to use to get more businesses and people pay what they are supposed to pay.

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