The Uganda Revenue Authority (URA) has established mechanisms to start collecting the Value Added Tax (VAT) from the non-resident service provider companies operating in the country’s economy.
This is starting on July 1, 2022, and will focus on all electronic service providers such as Facebook, Uber Netflix, and Amazon. According to URA projections, the country will earn at least UGX 25 Trillion.
“There’s a global forum under the OECD giving us access to 144 countries to share information with. It will tell us who is trading within our economy and is supposed to pay money to our country instead of taking it to another country,” URA commissioner general, John Musinguzi told a gathering at the tax-body’s post-budget conference in Kampala.
The VAT is expected to stretch over websites, web hosting software firms, and those supplying images, text and information including self-education packages, music, film, gambling, and other broadcasts and events digital platforms.
Musinguzi also said that Uganda is left with only one option to efficiently collect revenues from within the country and URA must mobilize more stakeholders to join this effort.
It should be noted that Facebook, one of the target companies was banned in Uganda in 2021 and is only accessible using Virtual Private Networks (VPN).
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