Despite traders strike over high taxes and enforcement of Electronic Fiscal Receipting and Invoicing Solution (EFRIS) by Uganda Revenue Authority (URA), Finance Minister Matia Kasaija has maintained usage of EFRIS.
” I have given URA a go-ahead to continue implementing the EFRIS but put emphasis on sensitization and hand holding of taxpayers to appreciate the EFRIS and also ensure that it is demystified among all taxpayers,” Matia Kasaija said.
“With immediate effect establish an office in Kikuubo that is solely dedicated to providing EFRIS support services to all traders and other taxpayers,” he stressed.
The Minister has also ordered Commissioner General URA to submit the list of traders currently having outstanding EFRIS penalties, for his consideration for possible waiver.
Kasaija says his ministry shall, within the next two weeks, study and consult on the proposal to increase the current VAT threshold and the VAT rates, and communicate the Ministry’s position on the matter, taking into account the findings from the study and relevant consultations.
Under their umbrella association Kampala City Traders Association (KACITA) traders had initially requested the government to consider increasing the VAT threshold from Shs150 million to Shs1 billion and a reduction of the VAT rate from 18% to 16%.
They had demanded EFRIS scrapped off noting that it imposes a high cost of compliance; most traders don’t understand the system; and that it applies to all traders irrespective of whether they are VAT registered or not.
Traders argued that the import duty of USD3 and USD3.5 per KG or 35% whichever is higher for textile fabrics and garments respectively is very high.
They noted that URA gives different values to different importers and at different times, for the same imported items.
Traders however complained that some manufacturers, notably foreign investors, are participating in distribution, wholesale, retail, and hawking of their products which results in under-cutting prices and thus low sales
URA introduced EFRIS in 2021 to address tax administration challenges relating to business transactions and the issuance of receipts.
EFRIS is an initiative under the Domestic Revenue Mobilization Program whose aim is to address the tax administration challenges relating to business transactions and issuance of receipts.
As e-invoicing is an automated service, the customer no longer needs to provide their invoice data manually. This reduces error and consequently reduces the number of invoice rejections and disputes. A digital process ensures invoices are correct and authentic so buyers can make payments quickly without delay.
