Legislators on the Committee of Finance have questioned the way and standards the Uganda Revenue Authority (URA)is utilizing to increase tax waivers to firms and people.
While showing earlier than the committee, the State Minister for Finance (General Duties), Hon. Henry Musasizi stated the tax waivers will likely be prolonged to eight organisations which embody educational establishments and enterprise entities.
Musasizi was showing earlier than the committee on Tuesday, 20 August 2024.
Among the businesses beneath assessment by the committee is M/S J2E Investment Corporation Limited which is searching for a tax waiver value Shs2.718 billion as at 01 December 2023, accounting for curiosity collected.
M/S J2E Investment Corporation is finishing up works at Kawewe6a Military Training Barracks.
The minister revealed that in December 2019, the Defence Ministry requesting for the waiver.
“This is as a result of through the implementation of the works, the contractor confronted investigations from the Inspector General of Government and suspended all works and funds from Ministry of Defence. This resulted in penalties and curiosity,” Musasizi stated.
Hon. Patrick Ocan (UPC, Apac Municipality) stated the absence of audited accounts and articles of affiliation for the corporate made it questionable to grant a waiver.
“Today, the minister has introduced to us non-existent firms. If they’re existent, I’m certain the minister can present the required paperwork for this firm. How can we course of a waiver for a corporation that’s not identified? How can we verify status and credibility?” Ocan requested.
Kira Municipality MP, Hon. Ibrahim Ssemujju and Hon. Maximus Ochai (NRM, West Budama County North) put the minister and URA to job on the procedures that had been adopted in granting tax waivers to chose firms.
Hon. Jane Pacuto (NRM, Pakwach District Woman Representative) puzzled on why the businesses had been granted a 100 per cent tax waiver.
“I would like a clarification on whether or not or not, an entity or particular person should meet all the standards or a part of the standards, to qualify for a waiver. The minister additionally selected to waive 100 per cent and I wish to know why they selected to go that path,” Pacuto famous.
Sarah Chelangat, the Commissioner Domestic Taxes at URA stated purposes for tax waivers are obtained and assessed on a case by case foundation including that firms are granted a grace interval inside which to pay the tax.
“We additionally have a look at the massive image when it comes to the affect of this enterprise on the neighborhood it serves. Businesses like universities make use of households, so we contemplate that if this firm will get a aid, it will possibly proceed paying extra tax within the close to future,” Chelangat stated.
She additionally clarified on the matter of audited accounts.
“When a tax payer is doing a self-assessment return, they usually summarise all their account info of their tax returns. Sometimes, assess primarily based on third celebration info whereby if you happen to work with a ministry, we will get the data from that ministry,” Chelangat added.
The Committee Chairperson, Hon. Amos Kankunda, requested the minister and URA to current the requisite info on M/S J2E Investment Corporation Limited to the committee earlier than a remaining report is made on its waiver.
Other people listed for a tax waiver are Donati Kananura, who as at 12 September 2023 sought a waiver on rental earnings tax amounting to Shs1.69 billion and a waiver on Value Added Tax amounting to Shs2.08 billion.
Legislators famous that grounds on which URA granted the tax waivers together with well being and superior age weren’t justifiable.
“I wish to withdraw Donati Kananura from my record in order that we restrict debate on the matter. We will discover one other manner of rescuing him,” Musasizi responded.
The different entities introduced earlier than the committee for tax waivers included M/S Nicontra Limited, Busoga University, Nkumba University, Makerere Business Institute, Kisiizi Hospital Power Limited, and Mr. Peter Lokwang, a vendor in limestone mining in Moroto District.