URA battling fake documents to recover billions of Shillings

Forgery. Some of the fake stamps that Uganda Revenue Authority found with a clearing agent in 2016. The listed firms are being investigated over alleged forgery of documents including tax clearance, completion certificates and certificate of registration. FILE PHOTO

What you need to know:

Motive. The documents are forged mostly to under-declare goods.

Kampala. As it battles a revenue shortfall of Shs250b, Uganda Revenue Authority enforcement (URA) team says it has uncovered a group of people who are forging documents in order to evade taxes.
The authority cites an importer, who submitted invoices to of 32 motorcycles with each valued at $380 (Shs1.3m) through a clearing agent, Jinca Enterprises.
However, the invoices were found to be falsified. The actual value of each motorcycle, according to URA, is $2500 (Shs8.3m). The import value was under-declared by Shs7m.
“Over the last few months, we have found out that a lot of document forgery was going on,” Ms Agnes Nabwire, the assistant commissioner in charge of Enforcement at URA, told reporters on Monday.

“What we found after investigations carried out on Thursday last week included stamps of foreign companies registered in China. These stamps were used on documents to alter valuations of imported goods,” she added.
At least six stamps of Chinese companies were found with one clearing agent, Jinca Enterprises.
Ms Nabwire said documents being forged included shipping details, the bill of lading, invoices, bank slips, and receipts. The documents help companies under declare their goods, hence resulting in less or no tax payments.
URA reveals that one of the clearing agents imported motorcycle spare parts valued at $97,000 (Shs323m) but that invoice was never declared, meaning no tax payment was made.
The documents URA has found indicate that forgeries were being made in Uganda yet the origin of the goods was in countries such as China.

However, the tax body says it cannot exactly quantify the revenue shortfall caused by the document forgeries.
“We are analysing and investigating to ascertain the actual amount lost in this trade. However, we are strengthening our intelligence in order to recover this money considering the challenges in the market,” Ms Nabwire said.
Companies found to have taken advantage of document forgeries could end up paying more tax than they paid as URA investigates how entrenched the problem has been over the years.
Clearing agents are licensed by URA and if any is found to have breached the conditions, then they could be deregistered.

The under-declaration case

URA has battled cases of under-declarations for years and has been embroiled in a stand-off with the Kampala City Traders Association. The tax body has insisted that anyone found trading these under-declared goods be prosecuted. However, the traders protested this in December 2015. The trouble for URA is nailing the actual perpetrators of the crime.