Each year, a number of tax laws are passed by the parliament. Hundreds of tax books, audits and cases also continue to surface the taxation space; but, have you ever wondered why some tax principles are not made clear?
The Uganda Revenue Authority is a government revenue collection agency established by the Parliament of Uganda under the Uganda Revenue Authority Act Commenced on 5 September 1991.
Operating under the Ministry of Finance, Planning and Economic Development, the URA is responsible for enforcing, assessing, collecting, and accounting for the various taxes imposed in Uganda It is clear that taxpayers have a right to be treated fairly in all their dealings with URA.
Tax laws and all its related procedures are applied consistently to all taxpayers without discrimination in line with the canons of tax. Join me today as I take you in a threshold of lawful avenues Uganda Revenue Authority doesn’t want you to know!
To understand tax, you need to know that Tax is a money charge imposed by the government on persons, entities transaction or property to yield public revenue. Under income tax act defines tax as any tax imposed under the some act. Tax is not a voluntary payment or donation, but any enforced contribution, exacted pursuant to legislative authority and are any contribution imposed by government whether under toll, tillage, gable, impost, duty, custom, excise, subsidy or other names(. Blacks law dictionary, Bryan Garner)
Taxation is a device used by the government to collect revenue from different entities which by law are required to pay taxes. Taxation means an imposition of duties for raising of revenue as per Osburn’s law dictionary. Tax avoidance can be said to be a legal way by which a tax payer can get relief through the payment of less amount he or she ought to have paid for the assessed tax period whereas
Tax avoidance is a legal way by which a tax payer can get relief through the payment of fewer amounts he or she ought to have paid for the assessed tax period. Evasion is the one illegal. For avoidance, it involves taking advantage of the loopholes in the system. This practice involves deduction, exemption, among others as a tax payer’s advantage.
The Uganda constitution 1995 as amended under Article 152(1) and (3) provides that“no tax shall be imposed except under the authority of the act of parliament and the parliament shall make laws to establish tax tribunal for the purposes of setting tax disputes. Parliament enacted tax appeals tribunal act and section 41(1) provides that any person who is aggrieved by a decision made under taxing act by the Uganda revenue authority may apply to the tribunal for a review of the decision.
Article 17 of the constitution of Uganda as amended provides that it’s the duties of the citizen to pay taxes. This provision envisages a time when a dispute has arisen from misinterpretation of a taxing act since all tax legislation is found in laws of parliament. A statute is a written law passed by a legislation body to regulate, authorize or prohibits certain action.
Interpretation is crucial part of the law, although the law might be well stated no matter the aspect; interpretation is a key factor in determining the intention of the enactors of the particular legislation. Where the tax law is ambiguous, it is interpreted in favor of a tax payer. Therefore, tax laws must be clear if they can be enforced
In the case of URA V Meera Investment Ltd where it was stated that tax laws are ticked against the constitution. As the case of Tallow V Heritage Oil and others where it was stated that is a general principle of Ugandan statutory construction that no tax is to be imposed except with clear statutory language.
. Uganda operates under a self assessment method where URA allows individuals to make their own assesements and only checks their validity; therefore URA only employs tax recovery measures when taxpayers do not respond to assessments.
Now, it is not an offence to divide your business into two different business to avoid reaching a gross amount heavily taxed in the schedules, Do you know that certain goods and industries are exempted from paying tax? How can you group your business in such category is a point of statutory interpretation and employing skilled tax legal planners.
In conclusion, U.R.A is like a dog that always hunts for meat, it is never satisfied and therefore doesn’t apply equity in tax.
Discussion about this post