By Kassim Ssematimba
The URA Commissioner General John R.Musinguzi on Thursday met with the business community from Pakistan who operate in Uganda. The meeting took place at a hotel in Kololo where the Pakistanis were led by their country’s High Commissioner to Uganda H.E Mohammed Wazir.
The diplomat had last month met with Musinguzi and requested for a meeting between his business community members and URA top management. The idea was to enable the exchange of ideas on how the trade volumes between the two countries can be enlarged from the current mere USD42.5m as of last year to something bigger.
Musinguzi explained that he saw this request for a meeting as an opportunity and prioritized the same because his organization’s other mandated role, apart from tax collection, is that of trade facilitation which basically is about diminishing barriers to trade between Uganda and the rest of the world.
Convinced that there is much more potential than the current USD42.5m being exchanged in trade between the two countries, Musinguzi availed himself to listen to members of the Pakistani business community share on the tax or URA-related constraints they face which can be overcome in order to amplify trading activities between the two countries.
Musinguzi explained that Pakistan, which only exported goods worth USD6.5m last year, still has a lot of capabilities in areas like agriculture and pharmaceuticals which should be explored to enlarge related manufacturing activities in Uganda.
He revealed that on the export side, through which Ugandan exporters earned up to USD36m last year alone, our country can take advantage of the 240m population Pakistan has to grow its export earnings and bring in the badly needed foreign exchange. In reciprocity, Pakistani investors and traders or exporters can take advantage of Uganda’s very active population of 45m (boosted by access to vast regional markets under COMESA, EAC and SADCC access) to export more here. Musinguzi registered his desire to see the Ugandan and EAC regional market equally be taken advantage of by the Pakistani who are renowned for their business shrewdness.
The Kololo engagement was also used to sensitize the Pakistani business community members on the available incentives in Uganda such as the unfettered access to the regional markets, the predictably stable political & economic environment besides the very friendly tax administration regime.
The assistants Musinguzi came with, such as Domestic Taxes Commissioner Sarah Chelangat, explained at length the different tax incentives Pakistanis can leverage upon to increase export and import trade relations with Uganda. He told them about Industrial Parks-related tax incentives which they can take advantage of to set up lucrative manufacturing processes and produce products for the export to vast markets available under COMESA and EAC including DRC which will soon be becoming a fully-fledged EAC member.
Musinguzi commended the High Commissioner for his keenness and declared readiness to create more time to have many more such engagements with members of the Pakistani business community who he wants to invest more in Uganda to enlarge the tax base while creating new decent employment opportunities for the Ugandan youths and women whose employability the CG highlighted because of their exposure to one of the best education systems the contemporary world offers.
The URA boss also permitted the Pakistanis to raise all their concerns besides asking all tax-related questions they have ever had about Uganda as an investment destination.
All their questions were responded to, to satisfaction, and that’s how the Kololo engagement turned out to be such an excellent opportunity for Musinguzi and his teams to get feedback from such an important cluster of taxpayers. The CG announced that, having realized the value such meetings add onto the tax administration landscape, he will be availing himself to holding similar meetings with investors and business community from all the other countries with diplomatic representation in Kampala.
He made it clear URA is prepared to play its full role 100% (under the trade facilitation mandate) to ensure that no investor or potential job creator stays away because of tax-related fears or URA-related inefficiency or even corruption (perceived or real). Indeed, during the Kololo Thursday meeting, the Pakistanis were encouraged to report all manner of inefficiency and corruption tendencies they have ever encountered in their dealings with URA staffers.
Using the plenary session, the Pakistanis opened up like never before. They told Musinguzi about some of his staffers who create artificial delays to justify or create room to extort money from them. One Pakistani tycoon made reference to Clearing & Forwarding agents who extort money from them claiming to be representing some of the mighty Commissioners at URA.
One investor said the Ugandan system had proved too frustrating to the extent that he knows of a certain agent who insists on extorting up to USD1,000 on every USD500 he makes in his car importation business. This shocked and appalled many people at the meeting prompting Chelangat to explain that such individual graft tendencies should never frustrate any Pakistani investor or be used to soil the image of the entire organization called URA.
At the instigation of Musinguzi, Chelangat explained the organization’s zero tolerance to corruption policy through which 90 URA staffers have so far lost their jobs and some got prosecuted in the last 3 years since the incorruptible Musinguzi took charge.
She also spoke about the staff compliance aspects at the new URA according to which a whole position of Assistant Commissioner has since been created to have a well empowered office dedicated to investigating, verifying and cracking the whip on corrupt staff members. The Assistant Commissioner’s phone number was read out to enable the aggrieved taxpayers from Pakistani to immediately report such extortionists.
Musinguzi assured them of maximum whistle blower protection. He explained this is the least of contributions members of the Pakistani business community can make to make the Ugandan tax administration system totally graft-free and more efficient for the good of all taxpayers.
Chelangat made it clear that all URA-related payments must be through the bank whereof a taxpayer gets a Payment Registration Number (PRN) implying that no staffers or officer is mandated to receive any cash on URA-related matters. All payments must be through the bank where it gets appropriately documented.
The URA team also announced readiness to crack the whip on rogue-minded Pakistani business actors, especially those involved in vehicles importation based at Kyambogo, who engage in manipulation of vehicle mileage and chassis number details for the sole purpose of diminishing their tax liability.
There will be an operation and the whip will subsequently be cracked. The URA team made it clear they have all the details and capability to catch each one of them though the CG relieved related fears and anxiety by announcing that the cracking of the whip will be preceded by a grace period which URA will proclaim and communicate to all and sundry.
The Pakistanis were also assured that the URA communications strategy was being reviewed to avoid multiple URA staffers communicating, writing emails and text messages besides phone calls demanding the same tax payment which sometimes has already been paid or cleared by the taxpayer. Chelangat explained that this is something that is being addressed because many taxpayers have raised it during the ongoing engagements with URA CG. She assured the clearly irritated Pakistanis that this is ending real soon.
The Pakistanis were also sensitized and permitted to ask as many questions as they could about the practice and the law governing things like VAT refunds which they complained are not always made promptly even when this is something to which the taxpayer is entitled. Chelangat promised reforms and improvement in that area too as the Tax Body’s budget or funding situation improves and gets better.
Complications involved in importation of SWT rice into Uganda from both Kenya and Tanzania were also exhaustively discussed with Musinguzi promising the final resolution of the problem real soon. He said very high level stakeholder consultation was ongoing adding that the same would soon be concluded.
The Pakistani High Commissioner to Uganda promised to do all he can, including organizing more trade delegations’ exchange visits, to ensure increasing trading partnerships between Ugandan and Pakistani business actors beyond the government to government engagements.
He saluted Musinguzi for being flexible and willing to go an extra mile to facilitate trading activities between the two countries. He also commended Ugandans for their hospitality towards business actors from his country and made it clear that his country Pakistan (from which Ugandan exports fetched up to USD36m last FY alone) was at all times ready to reciprocate by very warmly receiving trade representations from Uganda.
He also appreciated Musinguzi’s openness and willingness to tackle and stamp corruption and deliberate inefficiency out of his organization (URA). Speaking to reporters, the High Commissioner challenged leaders of other GoU entities and MDAs, charged with trade promotion, to emulate Musinguzi’s clarity and assertiveness when it comes to working towards a zero tolerance to corruption situation.
