URA to conduct lifestyle audit

Kampala. Uganda Revenue Authority (URA) has approved a proposal to subject all staff to a lifestyle audit.
The audit, which will study every staff’s living standard to see if it is consistent with their income, seeks to safeguard the integrity of the tax collector, which has suffered over the years.
The European Union, Mr Protazio Begumisa, the URA commissioner for internal audit and compliance, said has already pledged to fund the exercise in the next financial year.

So far, Daily Monitor understands, five URA staff are being profiled on suspicion that they have been using proceeds from tax fraud and related illegal activities to acquire unexplained wealth.
Mr Begumisa said the board had endorsed the idea, describing it as an important aspect that will identify staff who are engaged in illegal activities and related tax fraud.

“The EU is willing to give us about Shs600m for this exercise” he said on the sideline of the East African Revenue Authority Committee Meeting on Integrity in Kampala last week, adding: “The board is fully supportive of enhancing integrity and fighting corruption.”
The money will also be used to improve the capacity of URA’s internal audit and acquisition of tools to ease work.
Fraud and corruption is usually committed in “off book” transactions or manipulated accounting records which are usually hard to detect.

Earlier, Mr Henry Saka, the URA commissioner for domestic taxes, told the meeting that participants attending the East African Revenue Authority Committee Meeting on Integrity that lack of integrity among public servants was jeopardising tax compliance.
“Perception is crucial in influencing compliance and it is important to enhance our integrity so that the public can perceive us in good light because this will ultimately boost compliance. One question we are being asked all the time is why should one pay tax only for another public servant to pocket it,” he said.

In her remarks, Ms Annet Twine, the director leadership code at the Inspectorate of Government, said collaboration between government ministries, departments and agencies can be frustrating in dealing with corruption and related vices.
She, however, pledged the support of the Inspectorate of Government to help URA instill integrity and deal with corruption, which continues to taint the tax body.

Ethics and Integrity minister Simon Lukodo, who was the host of the meeting, said government had put in place enough institutions to fight fraud and corruption-related cases.
The Inspectorate of Government, Director of Public Prosecutions, police and the Anti-Corruption Court among other, he said, have been established to fight corruption, fraud and related crimes.
Mr Lokodo also said that he would soon announce the zero tolerance to corruption policy, which will help to implement the fight against corruption.

Undermining tax efforts

One of the major challenges undermining tax efforts is tax evasion. For example, about 30 per cent of eligible VAT is not collected, translating into a loss of about 4 per cent of tax to GDP.
VAT evasion involves the use of non-existent transactions claiming input tax against purchases and expenses that were not incurred and issuance of invoices for business transactions for which there is no genuine supply of goods or services.
So far, URA has recovered Shs605b from companies evading tax and another 2,100 companies are undergoing comprehensive review to determine the liabilities not yet paid.

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