By Jacinta Obore Mirembe
URA has step up its oversight of the use of Digital Tax Stamps to boost compliance and aid alcohol producers in the fight against counterfeit drinks and the sale of illegal beverages, which they say has led to unfair competition.
This decision was reached at a recent meeting between the taxman and key players in the alcohol industry under their umbrella organization, the Uganda Alcohol Industrial Association (UAIA).
In addition to affecting their sales, the brand owners say the prevalence of illegal and counterfeit beverages on the market has affected their tax compliance.
“Right now, brands like Johnnie Walker, Jameson, McCallan, and Amarula are being sold at black market prices, which is affecting our mark-ups. This puts us in a very difficult situation, and it also negatively impacts duty remittances,” said Juliana Kaggwa, the Corporate Relations Director at Uganda Breweries and Vice-Chairperson UAIA.
During the meeting, brand representatives also raised concerns about the varied valuations assigned to them and parallel importers by customs. According to them, this leads to market discrepancies.
Abel Kagumire, the Commissioner of Customs at URA, allayed their concerns by revealing that URA is working to standardize the value database for all industries. He requested that the manufacturers send a technical team to collaborate with the customs valuation team, starting with the “hot” items.
He also commended the industry for its compliance. With more than Ugx 7.8 billion in annual Customs revenue, the alcohol industry ranks sixth among the department’s largest taxpayers.
The association thanked URA for consistently responding to their concerns.
“Challenges withstanding, I would like to convey my sincere appreciation to the Uganda Revenue Authority for your efforts in gathering intel and addressing issues that arise in this industry, especially those that pertain to smuggling and illegal manufacturing of alcoholic beverages,” said Kaggwa.
Inorder to strengthen enforcement efforts, Ibrahim Bbossa, the Assistant Commissioner for Public and Corporate Affairs, urged the association to provide URA with information adding that doing so could enable targeted enforcement.
