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Kampala, Uganda | THE INDEPENDENT | The Uganda Revenue Authority-URA on Monday started the enforcement on the use of e-invoices and digital stamps.
A digital tax stamp is a physical paper stamp that is applied to goods or their packaging. It contains security features and codes to prevent counterfeiting and tampering. It also helps in tracking and tracing goods.
In 2019, URA introduced the digital tax stamp to combat illicit trade, seal revenue leakages, boost collection and increase efficiency in managing taxpayer compliance, and in 2020, it introduced the Electronic Fiscal Receipting and Invoicing Solution (EFRIS).
The EFRIS is a solution that is used by businesses to manage the issuance of receipts and invoices for tax purposes in accordance with the Tax Procedures Code Act 2014. At the point of buying or paying for a good or service, the system transmits the transaction details electronically to the URA in real time and a tax is processed and included on the invoice or receipt for the customer paying for the goods.
According to URA, all VAT-registered taxpayers are required to issue e-invoices/e-receipts for all their business transactions.
Ian Rumanyika, the URA spokesperson in charge of Corporate Affairs says that the move is part of the tax body’s countrywide monitoring of compliance to the issuance of e-receipts and e-invoices, as well as incorrect supply of goods without digital stamps.
According to Rumanyika, enforcement had been delayed due to a lack of staff and sensitization of the business community.
Paddy Ochieng, the Manager Kampala Metropolitan Domestic Taxes Department says that two URA staff have been deployed at more than 40 supermarkets in different parts of the country to ensure that they issue the e-invoices for all transactions.
He adds that the staff will also verify the digital tax stamps on all the products in the supermarkets.
In 2018, Ugandan manufacturers raised a red flag over digital stamps. They wanted URA to show if the digital stamps will increase revenue collection and compliance considering that the formal manufacturers are already compliant, and show proof that there is under-declaration and undervaluation.
They also wanted URA to explain what the DTS would achieve if a manufacturing sub-sector has no counterfeits.
In 2020, the High Court Commercial Division issued a four-day interim order restraining URA from enforcing the digital tax stamps. This came after Muwema and Company Advocates, acting on behalf of Sylvester Kamuli went to court challenging the implementation of the digital tracking solution.
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