Nordic businesses vent their frustrations over doing business in Uganda

Businesses from three Nordic countries of Denmark, Norway and Sweden under their umbrella body, the Nordic Business Association of Uganda, complained of lack of transparency and inconsistencies in imposition of taxes and communication of new tax proposals.
Business people from Nordic countries have expressed their frustrations over the unfavourable business climate in Uganda.

The Nordic Business Association of Uganda is comprised of Businesses from Businesses from  Denmark, Norway and Sweden says there are inconsistencies in tax imposition by  Uganda Revenue Authority.

They  were meeting the Minister of Trade, Industry and Cooperatives Amelia Kyambadde in Kampala on Thursday.

The Nordic businesses complained that Uganda Revenue Authority (URA) taxes green products like solar equipment and accessories and yet they are supposed to be tax exempted.

They also cited a situation where a taxpayer challenges a tax assessment in the tax appeal tribunal and wins, the 30 percent of the disputed amount he pays to the tribunal is not returned and neither is the required interest of two percent added.

They say the 30 percent paid is instead deducted from future tax payments.

A case in point is a company African Lease and Trade Limited that lost millions of shillings after a loan was assessed as income leading to increased tax liability.

Other complaints include delays in licensing investments, processing work permits and in issuing export permits.

Erostus Nsubuga, the Chairperson of the Swedish-Uganda Business Association, said it is saddening that Uganda Investment Authority has been talking of a one-stop registration and licensing centre for years but with no tangible results.

Rikka Adamsen, the Chairperson of the Nordic Business Association in Uganda, said the conditions on the ground are frustrating to their businesses, adding that for them time is money.

Adamsen said they get frustrated to the extent that they are sometimes confused about where to go and how things are done in the country. She requested for a focal person in the ministry to deal with Nordic business affairs.

Kyambadde  advised the Nordic businesses to start participating in the annual tax reviews to push through their concerns and proposals.

The minister suggested that they could get affiliated to the Private Sector Foundation of Uganda which is the apex body of private sector business associations. Private Sector Foundation participates in the annual tax review process some of its suggestions have ben reflected in the past budgets.

On taxation of green energy equipment, Kyambadde said solar equipment and accessories are tax exempted and wondered why they are being taxed.

On frustrations over delays in processing investment licenses, work permits and export licenses, Kyambadde said the one-stop centre at the Uganda Investment Authority is meant to ease the process, wondering why such complaints persist.

Nicholas Kanabahita, Uganda Revenue Authority\'s  Legal Manager for Customs, said exemption of taxes on solar equipment actually includes value added tax too, meaning the cost is not pushed to the consumers.

On complaints by African Lease and Trade, Kanabahita said the company should enter into talks with URA because the law provides for the money to be refunded with two percent interest.

The Danish Ambassador Dan Frederiksen, speaking on behalf of his colleagues, said they are keen to see Nordic businesses play a crucial role in the development of Uganda, just like the Nordic governments have done since independence.

The meeting then resolved that the Nordic businesses should get involved in tax consultations, business registration services be improved and fastened, challenges in getting work permits be addressed, among others.

In attendance were the ambassadors from Denmark to Uganda Dan Frederiksen, Norway Thorbjorn Gaustadsaether and Sweden Urban Anderson.