KACITA's Thaddeus Musoke
Two months ago, the Uganda Revenue Authority (URA) and leaders of the Kampala City Traders Association (KACITA) met over container leaders. URA Commissioner General John Musinguzi and Thaddeus Musoke of KACITA led their teams, respectively.
Traders had raised issues of delay of goods in the warehouses. Musinguzi explained that the delays were not the making of the URA but rather the container leaders who delayed having their goods verified and, in the end, accused the URA of being in the wrong. The container leaders had noticed that the URA had taken on the initiative to verify goods as opposed to using invoices. Previously, container leaders were approaching the URA Customs team with invoices showing what was in the containers.
“So, they would say, I have 300 pieces of t-shirts. Yet, in the actual sense, there are 3,000 pieces, but because the URA was using invoices and not verifying, there was under-declaration, and the URA lost revenue.”
However, the URA recently started the system of verifying these goods.
“So, currently, a container leader will come saying that he or she has 200 pieces of khaki trousers, for example, and a staff member of the URA will say, ‘Okay, open the container,’” a knowledgeable source says. “The leakage has finally been plugged.”
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During the meeting, CG Musinguzi directed that all containers from China and Dubai come with individual house bills and traders pay individual tax through their TINs, as opposed to waiting for container leaders. Musoke agreed to all details of the meeting and appealed to his colleagues (container leaders and traders) to cooperate.
However, last week, the same KACITA incited traders into a strike on the grounds that the URA had increased taxes.
Yet, during the same meeting, KACITA was informed that container leaders were underdeclaring goods, depriving the government of revenue. Under declaration is when a trader, for example, presents an invoice saying that what is in the container is 500 pairs of jeans. Yet, upon verification, what is found are 5,000 pairs of jeans. Meaning the container leader will have underdeclared goods by 4,500 pairs of jeans.
Once caught in the underdeclaration scam, taxes go up by sometimes over 50%. Container leaders have instead been telling traders that the URA had increased taxes.
“So, they would say, I have 300 pieces of t-shirts. Yet, in the actual sense, there are 3,000 pieces, but because the URA was using invoices and not verifying, there was underdeclaration, and the URA lost revenue. Clearing each of these containers costs about Shs 200 million with the invoicing system. However, with verification, the revenue goes to about Shs 400 million. This is what the container leaders don’t want. But you can see that the URA has plugged that leakage, accounting for billions of shillings, which the government has been losing.
The container leaders were accusing the URA of inflating taxes, inciting the traders against the taxman. Yet, their trick had just been exposed, causing them to start lying to the traders.
The URA has appealed to traders with details of their container numbers to approach the Authority and claim their goods.
“URA warmly invites all importers who have brought in goods under groupage and have experienced delays in receiving their shipments due to ‘alleged delays’ in customs processing to kindly come forward and present the relevant documents for their goods,” said Robert Kalumba, the Ag. Assistant Commissioner, Public and Corporate Affairs, URA. “Our goal is to ensure transparency and fairness, helping you avoid unnecessary delays and the risk of being overcharged in taxes by middlemen (container leaders).”
This situation, however, exposes KACITA and its leadership as hypocrites and those with double standards.
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