Kampala, Uganda (UG STANDARD) – Uganda is facing a major tax shortfall after it emerged that over Shs31 billion in taxes on gold exports remains unpaid.
According to data from the Uganda Revenue Authority (URA), 46,263 kilograms of gold worth $2.98 billion were exported in the 2023/24 financial year, with taxes assessed at Shs34.77 billion. However, only Shs3.39 billion has been paid, leaving a shortfall of Shs31.38 billion.
The unpaid taxes are a significant blow to Uganda’s economy, which relies heavily on gold exports. Gold has become Uganda’s number one export, accounting for over 42% of the country’s total export receipts in the 2023/24 financial year.
URA officials attributed the unpaid taxes to a lack of an enabling instrument from the Ministry of Energy, which was required to guide tax collection. However, the Ministry of Finance referred CNN to the URA for comment.
“We did not have an instrument to guide us on how much gold exporters were required to pay,” said Asadu Kigozi, the URA acting commissioner customs. “However, we have since issued a new instrument, and exporters have started paying in installments.”
The unpaid taxes have raised concerns about the effectiveness of Uganda’s tax collection system and the potential for revenue losses. The government has promised to take action to recover the unpaid taxes and prevent similar shortfalls in the future.
Gold exports have become a crucial part of Uganda’s economy, with exports growing by 95.6% over the past decade. The country’s gold exports have been driven by the discovery of new gold deposits and the expansion of existing mines.
However, the gold industry has also faced challenges, including concerns over the environmental and social impact of mining. The government has implemented regulations to address these concerns, including the requirement for gold exporters to pay a tax of $200 per kilogram.
The unpaid taxes on gold exports are a significant setback for Uganda’s economy, but the government is confident that it can recover the lost revenue and prevent similar shortfalls in the future.
