The Uganda Revenue Authority (URA) and Uganda Manufacturers Association (UMA) have started sensitizing manufacturers about the Electronic Fiscal Receipting and Invoicing Solution system (EFRIS).
The drive comes at a time when the digital tax administration measure that interfaces the taxpayers’ daily transactional operations with the tax collector’s systems, is facing resistance from wholesalers across the country.
Deus Mugasho, a tax literacy officer from URA, said the tax body found it necessary to enlighten the manufacturers a little more about the system, although they are already using it. The system was first enrolled in the manufacturing sector and later in other segments of the business community.
According to Mugasho, the manufacturers appreciate the solution not just for using it as a URA requirement that is forced on them. He adds that since manufacturers were among the early adopters of the system, they could help others understand it if they were also well conversant with the solution.
During the meeting, manufacturers raised several concerns, some of which were calling for a total overhaul of the entire system and a VAT rate of 18 percent.
“When we are doing things let us not look at other countries like Kenya, Rwanda, and so on; let us look at ourselves. If it’s 18 percent, a small portion of people participate in the VAT bracket. EFRIS automatically opens up a lot of people into the VAT bracket which is a good thing. I don’t think you lose so much if you advise the government to adjust the rate and make things like sugar more affordable to many Ugandans,” one manufacturer explained.
He added that the government should keep in mind the burden that is put on the final consumers because as commodity prices increase, they have an option of abandoning consumption and finding other ways of survival, which affects the revenues collected.
The other concern from the manufacturers was a call for URA to refrain from calling themselves mere revenue collectors, saying it is not the true representation of who they are because they are the face of government taxation in the public, so they should also have an advisory role.
“For us as taxpayers, we expect the Ministry of Finance to listen to URA’s advice because it would have gotten it from our views. For us as manufacturers to keep in business, we expect the supply chain to continue and people to be able to buy whatever we are manufacturing. The EFRIS system has exposed the business community, and this will affect operations; therefore, a lot of sensitization is required.”
Muzamir Mabira, the UMA head of research and policy, noted that the engagement was necessary to eliminate the lack of understanding between the EFRIS enforcers and the system trainers.
He adds that it is disappointing to see URA offering EFRIS non-compliance penalty waivers to traders who are even opposing the solution but deny the largely compliant manufacturers.
