President Yoweri Museveni has rejected the Tax Procedures (Amendment) Bill, 2018 that was passed by Parliament in May this year.
In a letter addressed to the Speaker of Parliament, President Museveni has refused to approve the passed Bill in its current state and returned it to Parliament for review.
Deputy Speaker Jacob Oulanyah on Tuesday told the MPs that the President has returned the tax Bill to the House for reconsideration.
“The President says that the Bill in its current form will lead to some persons or organisations not paying tax,” Oulanyah said.
In his letter to the Speaker, Museveni is quoted as saying, ““In accordance with Article 91(3b) of the Constitution, I hereby return the Tax Procedural Amendment Bill 2018 to Parliament. Section 20(6) should be re-considered and deleted… Incorporating it in the Act will encourage non-compliance by the tax payers as regard to filing the annual tax…The current tax system[that] compels taxpayers to pay taxes through self-assessment has been effective. Therefore, the proposed amendment will further deter URA from charging interest on tax arrears hence creating revenue leakages.”
The object of the Tax Procedures (Amendment) Bill, 2018 that was passed in May this year is to amend the Tax Procedures Code Act, 2014, Act No. 14 of 20l4 to provide for due dates for filing returns under the Lotteries and Gaming Act, 2016; to provide for the Minister to pay taxes on behalf of a person; to waive all unpaid taxes due and unpaid by government as at 30th June 20l8; to provide for electronic receipting and invoicing; and to provide for penal tax relating to electronic receipting and invoicing.
Section 20(6) of the Tax Procedures (Amendment) Bill, 2018 states that, “Where a tax payer files returns with the Authority and an assessment is done by the Authority within a year, interest on the monies due from the period of assessment shall accrue from the date on which the assessment was conducted.”
Museveni’s rejection to Tax Procedures (Amendment) Bill, 2018 comes days after he made a U-turn on the controversial Excise Duty (Amendment) Bill, 2018 that was passed by Parliament to allow a 1% levy on all transactions on mobile money and Shs200 daily on Over The Top (OTT) social media services.