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Last week I was invited to moderate a stakeholder engagement between Uganda Revenue Authority and Construction and Hardware Dealers Association(CHADA) members. The candidness here is unbelievable. Hardware operators are protesting the ruthlessness of enforcement teams who raid their premises with soldiers on mere suspicion of tax evasion.

28,175 просмотров • 18 дней назад •via X (Twitter)

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The Federal Board of Revenue (FBR), in a major enforcement action against illicit cigarette manufacturing, has sealed a clandestine cigarette manufacturing unit in District Chakwal and seized a substantial quantity of raw tobacco, cigarette-manufacturing material, unstamped cigarettes and machinery. The overall economic impact of the operation has been estimated at approximately Rs. 211 million. The operation was conducted by teams of the FBR’s Intelligence & Investigation Directorate, Islamabad, in coordination with the Inland Revenue Enforcement Network. Acting upon credible information the teams raided the premises of Hunter Tobacco SMC Pvt. Ltd. located near Dharabi on Kallar Kahar Road, Chakwal. During the search, the enforcement teams found the premises being used for clandestine manufacture of cigarettes without the mandatory tax stamps under the Track & Trace System. The manufacturing unit had also not been integrated with the Track & Trace System, which is a mandatory requirement for tobacco-sector manufacturers. The operation resulted in the seizure of approximately 12,600 kilograms of raw tobacco, sufficient for manufacturing around 630,000 packets of cigarettes, besides filter rods, cigarette paper, aluminium foil, packaging material and other manufacturing inputs. The seized goods were shifted to a government warehouse and the premises were subsequently sealed. The estimated revenue impact includes approximately Rs. 90 million in potential tax evasion that could have resulted from the sale of the cigarettes manufactured from the seized raw tobacco. The overall economic impact of Rs. 211 million also includes the estimated duty and taxes evaded on stock found at the premises and the value of machinery and other materials seized/sealed during the operation. The FBR has reiterated that the manufacture and sale of cigarettes without payment of applicable duties and taxes, as well as non-compliance with the Track & Trace System, constitutes a serious violation of tax laws. The Board is taking strict enforcement measures to curb illicit manufacturing, protect legitimate businesses and safeguard government revenue. Further legal action and criminal proceedings against the persons found involved in the illegal activity will be initiated upon completion of the ongoing investigation, in accordance with law. The FBR has reaffirmed its commitment to intensifying enforcement against illicit tobacco manufacturing and other forms of tax evasion, while ensuring a level playing field for compliant taxpayers and legitimate businesses. *******

FBR

26,375 просмотров • 24 дней назад

Should the taxpayer still bear the burden of proof in instances where a tax dispute with the Revenue Authority is based in pre-populated & third party data? In my submission before the National Assembly's Finance & Planning Committee on behalf of the Tax Research Centre at Strathmore University, I argue that Finance Bill 2026's proposals seeking to anchor Incomes & Expenses Validation in law will be incomplete if they do not include a proposal for the the Revenue Authority being saddled with the burden of proof in such instances. Here's why: · Finance Bill 2026 proposes to amend Sec75 of the Tax Procedures Act to provide that the Revenue Authority may use technology to pre-populate tax returns on behalf of a person required to submit or lodge a tax return · Finance Bill 2026 further proposes that a person required to submit or lodge a tax return may rely on pre-populated return generated by the Revenue Authority to file their return · Finance Bill 2026 proposes to amend Sec112 to provide that the Cabinet Secretary of the National Treasury may make Regulations for the procedure for the submission or lodging of returns based on pre-populated tax returns generated by the Revenue Authority Here's where the problem is: · In all this, Sec56(1) which provides that "In any proceedings, the burden shall be on the taxpayer to prove that a tax decision is incorrect" remains unchanged · Sec56(1) is predicated on the fact that Kenya has been running on a self-assessment based regime & the data upon which tax disputes emerges was held by the taxpayer · With Incomes & Expenses Validation & the onset of a Dual Assessment regime in Kenya, taxpayers are now exposed not just to errors of judgement & data on their part, but also errors of technology & transmission which are out of their control · Can we really still have the burden of proof lying exclusively with the taxpayer in an environment where tax compliance has shifted from a function of record keeping to one where system integration reliability is now a key factor?

Julians Amboko

307,541 просмотров • 3 месяцев назад