Minister backtracks on directive, orders URA to withdraw export tariffs on gold

In a letter dated March 7, Minister Ruth Nankabirwa Ssentamu addressed the commissioner general of URA to halt the implementation of the $200 (Shs740,000) per kilogramme tax levy on all exported gold.

“Reference is made to the Mining and Minerals (Export Levy on Refined Gold) Regulations 2023 whose purpose is to collect arrears of outstanding export levy on exported gold from FY 2021/2022 to 30 June 2023. The purpose of this letter, therefore, is to request that the Uganda Revenue Authority halts the implementation of the Statutory Instrument until further guidance is provided,” the letter read.

This comes less than a month, on February 21, when Nankabirwa signed the Mining and Minerals Regulations 2023 which would see a tax of $200 levied on refined gold

The regulations were to work in retrospect dating to July 1, 2021, and run until the end of the financial year 2022/2023 after which a new rate would be agreed upon by all involved parties.

It is alleged that the Energy Ministry spokesperson, Solomon Muyita, was unavailable to explain the U-turn by the minister.

In 2021, the Ministry of Finance halted the tax body from implementing the five percent levy on each kilogramme of gold exported. Since July of that year, URA has been unable to collect taxes from gold exports a situation mainly attributed to the directive.

In the financial year 2021/2022, it was highlighted in the Auditor General's report that URA fell short of Shs340 billion in taxes imposed on gold exports. They had hoped to make up for the loss in part after the implementation of the $200 levy.

However, it is reported that URA spokesperson Ibrahim Bbosa said that he was yet to see the letter from Nankabirwa as of yesterday.