A few shops in downtown Kampala’s Kikuubo area remain closed as the traders maintain their protest against the 18% VAT charged on each item sold.
President Yoweri Museveni is on Friday expected to meet Kampala traders amid the ongoing standoff with the Uganda Revenue Authority (URA) over tax policy and administration, particularly the enforcement of the electronic Fiscal Receipting and Invoicing Solution (EFRIS), which traders allege is unfair.
John Kabanda, the President of the Federation of Uganda Traders’ Association (FUTA), made the revelation during an interview on Tuesday.
“We’ve been informed that President Museveni will meet with the traders on Friday. I assure the traders that by Friday, issues will be resolved,” Kabanda said.
A few shops in downtown Kampala’s Kikuubo area remain closed as the traders maintain their protest against the 18% VAT charged on each item sold.
According to some traders from the Federation of Uganda Traders Association (FUTA), Monday’s standoff was a warning to URA to reconsider the 18% tax on each commodity sold.
They have threatened a larger protest on 16th April if the tax isn’t revised.
“URA must revise the EFRIS system to reduce delays in receipts. Kikuubo traders have rejected EFRIS and when I try to encourage them to use it, they claim I have been bribed. URA should halt operations, re-strategize, and involve traders,” Mr Thaddeus Musoke, the KACITA chairman, said.
“The traders have rejected the EFRIS system. URA thinks its because traders are evading their tax obligation which is false. The approach URA is using is wrong and is supposed to be redesigned,” he added.
“We, as traders, advised the URA Commissioner General, Mr Musinguzi, that the EFRIS system won’t function in our shops. We suggested he go to the manufacturers as they control distribution channels being both manufacturers and distributors,” Kabanda said.
He added that many traders are “bayiribi” making it hard for them to handle the EFRIS system.
“Around 70% are not well educated, and they are not sure of their business’ survival. Additionally, the enforcers of this system are rude,” he said.
But Ibrahim Bbosa, the URA spokesperson, said many businesses are struggling with these taxes unnecessarily because the tax body hasn’t provided them with the support and guidance they require.
“We’re committed to assisting traders with regular discussions and helping them navigate the pain points of the law. We’ve noticed a significant amount of VAT money not being transferred to the coffers. Over the past months, we’ve been closely monitoring VAT collections in Kikuubo, witnessing a 500% improvement,” Bbosa said.
“EFRIS brings unparalleled transparency, detailing purchases, available stock, things sold, and aids in filing returns. This visibility benefits both the business owner and the taxman,” he added.
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