This year’s Top 100 mid-sized companies’ survey kicked off yesterday with a call to small and medium enterprises (SMEs) to be tax compliant.
Mr Peter Kyambadde, the director of tax and corporate services at KPMG, said businesses that do not want to pay tax are bound to face problems, especially with the anticipated implementation of the electronic fiscal system.
"The electronic fiscal device, which is a provision that came into our tax laws around two years back, is most probably going to be implemented this year and businesses will be required to acquire an electronic business machine," Mr Kyambadde said yesterday in Kampala while discussing the implications of the Financial Year 2019/2020 budget.
"Every sale I make has to go through the machine and once it does, it is reported directly to the Uganda Revenue Authority (URA). As such, URA will be able to correlate all your sales vis-à-vis other returns you make," he added.
Mr Kyambadde said businesses that issue invoices outside the new digital tax system are bound to face heavy penalties.
"Proactive tax management is the best tax plan. SMEs should be aware that the efficiency of the tax authority will improve because they increased the target by Shs2 trillion compared to last year yet there are not major increases in tax rates. They have to manage tax better because the taxman is a 30 per cent shareholder of the profits of your business. If you do not do business well, that 30 per cent can go up to 100 per cent," he added.
As part of the forum’s discussion, KPMG urged SME to invest in commercial farming and agro-processing so as to enjoy existing tax incentives.
However, the SMEs accused URA of stifling their businesses through stringent laws.
"As Top 100 club, we want to have a forum with URA because it is becoming a hindrance to our business growth. Someone fails to file returns in time, the system issues an assessment of Shs10m and you are not given clearance before you sign a memorandum of understanding. So we need help," Mr Geoffrey Matovu, the managing director TM Foodland, said.
The Managing Director of Nation Media Group-Uganda, Mr Tony Glencross, said all businesses are likely to have problems with URA in their journey but suggested more compliance to rules."Everyone at some stage in their business life has some concerns with URA but they are doing their job as we are in the pursuit of […]