Tax dispute hampers Uganda's gold industry, resulting in revenue loss of $160 million
According to a report by the Ugandan Parliamentary Committee on Finance, Planning, and Economic Development, Uganda has lost out on Ush600 billion ($160.77 million) in uncollected tax from the export of gold goods since July 2021 because of a dispute with exporters and refiners over levies.
Ruth Nankabirwa, Uganda's Minister for Energy and Mineral Development, however, blamed the loss on a dispute between the Uganda Revenue Authority and more than 20 gold exporters and refiners in her response to the report to the House on Tuesday.
“From the information provided by the Uganda Revenue Authority (URA), only two companies are willing to pay the tax. The other companies have raised concerns, and this is being evaluated,” the minister told parliament.
The disagreement can be linked to Uganda's Mining Amendment Bill 2021, which called for a $200 per kilogram (US$ 746,400) tax on processed gold and a 1% fee on unprocessed minerals.
The Parliamentary Committee on Finance, Planning, and Economic Development hiked the rate, claiming that processed gold was a valuable export, to 5% of the value of processed gold and 10% of the value of raw minerals. Later that year, the Mining Amendment Act 2021, which had the higher rates, was passed into law.
Both the Uganda Free Zones Authority and URA agreed that the rates were unsustainable and issued a warning that they risked losing the processing and refining of gold to other nations that do not impose such a tax. URA suspended the export levy in order to wait for a rate that could enable gold exports. Read More…
