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Limited knowledge to blame for tax incompliance in construction sector- stakeholders
What you need to know:
- URA says it has intensified tax education among masses to close the knowledge gap that was causing tax problems.
Stakeholders in the construction sector have outlined limited knowledge on tax administration, high tax burden, lengthy tax dispute resolution mechanisms, and corruption among some tax collectors, as the main reasons fueling tax compliance gaps among them.
Under their umbrella body, Uganda National Association of Builders, Suppliers and Engineering Contractors (UNABSEC), constructors who spoke during their sector tax dialogue in Kampala on September 26 said Uganda Revenue Authority (URA) must address the challenges to enable them pay their taxes without fail.
“Members encounter challenges of heavy penalties imposed on principal taxes. A particular member attempted to make the tax payment, only to find that the URA system was inaccessible due to technical difficulties towards the end of December 2023. As a result, the member incurred penalties, and interest continues to accrue on these penalties,” UNABSEC president Jamesone Olonya
URA, he said, must intensify tax education especially on new developments like the Electronic Fiscal Receipting and Invoicing Solutions (EFRIS) which is not yet understood by the majority of their new members.
On corruption, Olonya said, “We shall not be shy to deal with the issue of corruption involving URA officials because it’s real and presents a significant challenge for providers. The challenges our members face include; overassessment of taxes and unnecessary delays in the assessment process.”
In response to these concerns, URA’s supervisor for tax education in-charge of central region, Ms Hafsah Sseguya, said that the authority has intensified tax education among masses to close the knowledge gap that was causing tax problems.
“We need to address all stakeholders’ needs through such dialogues, teach them about voluntary compliance which is cheaper than waiting for URA to come which come with a cost like penalties, interests, we have gone digital so in such dialogues we keep our people informed of how simplified our taxes are and where to touch in case there are challenges,” she added.
The dialogue was organized by UNABSEC in collaboration with URA and the National Cement Company Uganda, under the theme: Enhancing Tax Compliance and efficiency in the construction sector through dialogue.
Mariam Namiya, the UNABSEC acting executive director said that the dialogue aimed at providing valuable insights into tax regulations, compliance requirements and addressing the distinct challenges faced by contractors, suppliers, builders, manufacturers and all stakeholders in the construction industry.
Speaking on behalf of the ministry of finance economist Gerald Namoma observed that such dialogues bridge gaps between the government and the sector stakeholders.
