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Kampala, Uganda | THE INDEPENDENT | Uganda Revenue Authority (URA) has rolled out its digital tax stamps initiative geared at combating illicit trade and seal revenue leakages.
Clare Musiime Bakanga, the URA head of change digital tracking solutions said many traders and businesses are being challenged by unfair competition of those smuggling in goods.
She said URA is working with Uganda National Bureau of Standards (UNBS), to ensure they minimize revenue leakages, combat illicit trade and money laundering and be able to trace the whereabouts of the product.
Digital tax stamps are physical paper stamp which are applied to goods or their packaging but in this case contain security features and codes to prevent counterfeiting, tamper-proof features.
They will also have the track and trace capabilities to enable; consumers validate the stamp, traders and manufacturers track the product movement and government to monitor compliance of the product and stamp.
A quick response code (QR code) that will allow distributors, retailers and consumers to use an app on their smartphones to verify the authenticity of the products will be used.
When the stamps are placed on the products, they will reflect at the manufacturers’ server and URA’s digital server. This, Bakanga said, means they will have a record of how much was produced for the market to assess the tax applicable.
Bakanga told reporters at URA head office in Nakawa on Thursday that tax body is starting with high-risk six products: cigarettes, Beers, wines, spirits, sodas, and mineral water.
The digital stamps will apply to both domestic manufacturers and importers.
Bakanga said tobacco digital stamps for cigarettes will rolled out first in April and May. The stamps will be sent to the manufacturers in Kenya for the BATU case.
Cigarettes have been having manual stamps on their packets but these did not stop the smuggling because they were hard to trace. Cigarettes and other tobacco products are some of the smuggled goods into Uganda. Bakanga said the tax body losses up to 10 billion shillings annually in smuggled cigarettes.
In July 2019, beers and spirits will start carrying stamps while in August, it will be sodas. In September, all mineral water will have the tax stamps.
URA says digital stamps will help government address issue of illicit trade and counterfeit products -thereby protecting consumers against counterfeit products and safeguarding local manufacturers from unfair competition.
Tax evasion and smuggling-usually arising from cross border transaction fraud. They will also address the inability to track goods right from the production lines and customs entry points to the final points of sale.
Other products to be have digital tax stamps will be gazetted by the commissioner general.
