Africa-Press – Uganda. Uganda Revenue Authority (URA) has announced it is conducting research on registered law firms in the country, with the aim of tracing tax defaulters.
Law firms are categorised as professional services under large businesses that are by law mandated to pay taxes.
In a telephone interview yesterday, Mr Ibrahim Bbosa, the URA’s spokesperson and the assistant commissioner of public and corporate affairs, said it has come to their knowledge that many law firms are not paying taxes yet they are well conversant with their different tax obligations to abide by.
“If we are to comment on the number of defaulters that need statistical figures which I do not have. Many don’t [pay taxes] either knowingly or unknowingly,” he said.
Asked why they are not paying their taxes, Mr Bbosa said as tax collectors, they deal with four categories of people; those who pay taxes voluntarily, those who take advantage of the weak tax administration systems to evade taxes, those who pay willingly and another category that is coerced to pay.
During their 20th anniversary celebrations on Friday, Ms Belinda Lutaya Nakiganda, a partner at Birungi Barata and Associates, a legal and taxation consultancy firm in Kampala, told this newspaper that during a taxation symposium, many lawyers learnt a lot of information they previously did not know about taxation.
She explained that they always advise their clients to abide by all the tax laws to avoid penalties.
Ms Nakiganda said some businesses are paying taxes and yet they have a lot of incentives that exempt them from paying, which they are not aware of.
She urged URA to intensify tax education in the country, saying many Ugandans are embracing tax payment because of the widening tax base but they need to be sensitised about the benefits of taxation.
“Ugandans are embracing tax payment because of the widening tax base. People are learning that they have to pay taxes. No one wants to pay taxes because they think they are reducing their profits. We had a taxation symposium for Uganda Law Society two weeks ago and they learnt a lot they did not know about taxes. Everyone should be paying taxes,” she said.
She added that it is important for businesses to keep books of accounts and receipts because these will always help for reconciliation with URA.
Asked how the tax environment looks like today, Mr Cephus Birungi, the managing partner at Birungi Barata and Associates, said compared to 20 years ago when tax collection was under ministry of finance with a small tax-paying community, today, everybody knows the presence of URA and they are talking about effect of tax on their lives and tax literacy is increasing.
“People are now asking whether the government is increasing the taxes, whether the right people are being taxed, people are still examining the tax structure. This is a continuous process,” he said.
Asked why some members are not paying taxes, Mr Bernard Oundo, the president of Uganda Law Society, challenged URA to produce the number of defaulting law firms.
“Let them confirm the number then you can come to me for a comment. People need facts and figures. You can go to the Law Council and they will give you the number of law firms in the country,” he told this newspaper.
BARATA LAW FIRM
Barata Birungi and Associates, is a legal and taxation consultancy firm. It was established in 2003. According to Mr Cephus Birungi, the managing partner at Birungi Barata and Associates , the firm has been helping the big corporate institutions with the legal and tax obligations. On Friday, Nation Media Group, Aponye Uganda, and Global Paints, are among the companies that sponsored the celebrations which included cleaning up Jinja Road Police barracks and providing food items to families living in the barracks.
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