Digital stamps will fight fake goods - Bahati

Wednesday November 7 2018

Mr David Bahati, Planning state minister. FILE

Mr David Bahati, Planning state minister. FILE PHOTO 

By Eronie Kamukama

Kampala. Government has said it will not heed to private sector’s plea to increase taxes on counterfeit goods in a bid to make them costly for importers.

Government will instead introduce digital stamps that will help to track the origin of such goods with the view of fighting their entry rather than making them expensive.
Counterfeit consumer goods are often of inferior quality made or sold under another’s brand without the brand owner’s authorisation.

Dealers of such goods may infringe on either the trademark, patent or copyright of the brand owner by passing off its goods as made by the brand owner.

“Fake goods are not supposed to be in our economy so we cannot legitimise them by increasing taxes on them or reducing taxes on the genuine ones. We are going to make sure they do not enter the market. We have already signed an agreement with a service provider for digital stamps for Uganda Revenue Authority,” Mr David Bahati, Planning state minister, said yesterday in Kampala.

Every import will have a stamp right from the factory. Not only will the stamp be for purposes of taxing imports but also for enabling Uganda National Bureau of Standards (UNBS) to verify the quality of the goods.
“We think if we did that, which we are going to do in a few months from now because we have finished the arrangements, then fake goods will be reduced on the market,” Mr Bahati said.

He made the remarks while delivering a keynote speech at the Information Communications Technology (ICT), electronics and electrical products stakeholders’ conference held by Stop Counterfeit Products Africa.
Research from Stop Counterfeit Products Africa (SCP-Africa) indicates ICT, electrical equipment, solar and electronics are the most counterfeited products.

Mr Allan Mulindwa, the SCP-Africa managing partner, said since counterfeits are produced illegally, they are not manufactured to comply with safety standards because cheap, hazardous and unapproved material are used to cut costs.
Mr Bemanya Twebaze, the Uganda Registration Services Bureau (URSB) registrar general, said businesspeople trading in substandard products usually use counterfeit trademarks.

Data from UNBS indicates that 54 products of products on the market are substandard.
Information from SCP-Africa shows that in 2017, 232 metric tonnes of counterfeits goods worth Shs1.7b were seized by UNBS and 48 tonnes of substandard goods worth Shs950m were destroyed between July and December 2017.

The rising number of counterfeit goods stifle innovations as government loses revenue from taxes.
“Counterfeit products cause financial loss for owners and distributors of legitimate devices, consumers lose value for their money and country as a whole loses tax income and affect capital investment,” Mr Mulindwa said.

“Counterfeit electronic parts can undermine the security and reliability of critical business systems, which can cause massive losses in revenue to companies and government, pose threats to health and safety.”

Seized products
Information from SCP-Africa shows that in 2017, 232 metric tonnes of counterfeits goods worth Shs1.7b were seized by UNBS and 48 tonnes of substandard goods worth Shs950m were destroyed between July and December 2017.
The rising number of counterfeit goods stifle innovations as government loses revenue from taxes.

“Counterfeit products cause financial loss for owners and distributors of legitimate devices, consumers lose value for their money and country as a whole loses tax income and affect capital investment,” Mr Mulindwa said.
“Counterfeit electronic parts can undermine the security and reliability of critical business systems, which can cause massive losses in revenue to companies and government, pose threats to health and safety.”

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