Brief Facts:
The ruling was in respect of an assessment of penalty and interest that the Applicant claimed were waived by section 66 of the Tax Procedures Code Act (TPC), which provides for the compounding of offences as a result of voluntary disclosure.
Issues for Determination:
- Whether the Applicant is liable to pay the penalty and interest assessed?
- What remedies are available to the parties?
Tax Appeals Tribunal Decision:
- The following are the conditions to be met before a voluntary disclosure is deemed to have been made, so as to earn a person disclosing a penal tax waiver: (a) a person should have committed an offence under a tax law other than under s.63 of the TPC; (b) the voluntary disclosure should be made at any time before the commencement of court proceedings; (b) the offender should voluntarily disclose the commission of the offence to the Commissioner; (c) the Commissioner and the offender should enter into an agreement to compound the offence where the offender agrees to pay the outstanding unpaid tax; (d) and the Commissioner agrees that the offender shall not be required to pay any interest or fine.
- In the instant case, there was no clear admission and no voluntary disclosure by the Applicant. The process of disclosure was not completed since there was no compounding agreement.
The Tribunal issued a decision to the effect that the UGX 16,178,859,478 collected by third party agency notices as penalties by the Respondent was justified.
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