By Dismas Nuwaine
Business owners in Kabale District have been cautioned against engaging in fraudulent Digital Tax Stamp (DTS) practices. The Uganda Revenue Authority (URA) has identified several fraudulent practices, including reusing tax stamps, failing to activate stamps, placing them incorrectly on goods, and using counterfeit stamps.
Richard Mugarura, the URA Supervisor for DTS and Enforcement in the Southwestern region explained how tax stamp fraud occurs, citing an example where a cooking oil manufacturer and client collude to refill empty bottles without acquiring new tax stamps. This, he warned is a form of deliberate tax evasion, punishable by a penalty of UGX 50 million or double the tax due on the goods.
Mugarura advised manufacturers to place tax stamps at strategic locations, such as bottle openings to prevent reuse and to also curb tax fraud. Jacob Nasasira, the DTS Enforcement Officer for the Southwestern region, emphasized the importance of activating tax stamps, which allows URA to track the movement of stamped goods and ensure compliance.
Nasasira warned that failure to activate tax stamps would result in heavy penalties, including a fine of UGX 50 million or double the tax due on the goods. He also advised wholesalers and retailers to verify stamp authenticity using the URA Kakasa app and warned against defacing tax stamps, which would attract a fine of UGX 20 million or double the tax due on the goods.
Local business owners appreciated the URA’s efforts to educate them on tax compliance. Rachael Asiimwe, a retailer, expressed gratitude for the training, which enabled her to differentiate between authentic and counterfeit tax stamps. However, Sison Mwebaza, a tax consultant urged the Commissioner General to reconsider the heavy penalties, calling them excessive.
The URA has reaffirmed its commitment to enforcing tax compliance and warned businesses engaging in fraudulent tax stamp practices that they will face strict penalties.
