Business owners in Nebbi District have been warned by the Uganda Revenue Authority (URA) to adopt proper bookkeeping practices, hire professional accountants and file timely tax returns to avoid hefty tax bills and accumulated liabilities. The warning came during a stakeholders' meeting organised by Vurra pa Judongo, an elders forum, to gather traders' concerns ahead of a planned dialogue with URA. The meeting follows months of complaints from business owners who say they have been hit with excessive estimated taxes and accumulated arrears.
Preliminary findings by Vurra pa Judongo indicated that many affected businesses had significant turnovers but lacked proper books of accounts, did not engage professional accountants to prepare and file returns, and often failed to attend tax education meetings. Some businesses have already closed as a result of URA's tax collection exercise, according to Dr Jakor Oryema, chairperson of the Health Committee of the Elders Forum, who represented Canon Vasco Kura, chairperson of Vurra pa Judongo. The forum decided to intervene after meeting affected traders and said it would compile their grievances into a position paper for structured dialogue with URA.
A key concern raised was presumptive tax, a simplified income tax regime for small businesses. Under URA guidance, businesses with annual turnover not exceeding Shs10 million generally pay no presumptive tax. For eligible businesses above that threshold and up to Shs150 million, the amount payable depends on turnover and whether they maintain required records. Businesses with records are taxed using turnover-based calculations, while those without records are subject to fixed amounts determined by turnover bands. The system does not generally allow deductions for business expenses and losses.
Richard Oyirwoth, chairperson of the Business Community in Nebbi, said many traders relied on loans and suppliers to maintain stocks but paid insufficient attention to financial records and tax compliance. Traders have questioned assessments they believe overstate their actual business activity, arguing that estimates based on factors such as shop size, stock levels, location and number of employees may not accurately reflect annual sales, particularly for businesses whose performance fluctuates. This is especially significant in Greater Nebbi and the wider West Nile region, where some traders depend on cross-border commerce with the Democratic Republic of Congo and South Sudan.
Oyirwoth expressed concern about low participation in tax education programmes. The Tax Appeals Tribunal, a quasi-judicial body that reviews taxation decisions involving URA, recently held a sensitisation meeting in Nebbi, but many prominent business owners did not attend. According to Oyirwoth, Greater Nebbi had numerous grievances over presumptive tax but none had been formally filed with the tribunal in Arua, despite the Shs22,000 application fee. Taxpayers seeking a review must generally apply within 30 days of receiving the relevant taxation decision and must meet statutory requirements, including payment of 30% of the disputed tax where applicable.
Jennifer Vidda, the Nebbi District Commercial Officer, said her office had been sensitising business owners and building their capacity to maintain proper financial records. Vidda said bookkeeping was important not only for tax compliance but also for business growth and access to credit. She urged traders to maintain accurate records and seek professional assistance when preparing and filing tax returns.