Published on 09/07/2024
Legislators on Committee of Commissions, Statutory Authorities and State Enterprises (COSASE) grilled Minister Okaasai Sidronius Opolot over an 11-month delay in enacting gold tax regulations, costing the government Shs47 billion in lost revenue. The December 2023 report exposed the Uganda Revenue Authority’s failure to collect taxes on 70,837.91 kilograms of gold exports, worth Shs47 billion.
Without updated regulations, the US$200 per kilogram levy on processed gold went uncollected. The committee demanded immediate action to rectify the oversight and prevent further revenue loss. Minister Opolot vowed to expedite the process, acknowledging the urgent need for regulatory reform.
Abel Kagumire, Commissioner of Customs at URA, explained to the Committee that the lapse in regulations left URA without the legal framework to impose the gold tax. The existing law did not differentiate between processed and unprocessed gold, and with the expiry of the initial instrument in June 2023, it wasn’t until May 14, 2024, that a new statutory instrument was issued.
Medard Sseggona (Busiro East) pressed Minister Okaasai to explain why it took the Ministry 11 months to enact new regulations, despite several requests from URA and the Ministry of Finance. Sseggona pointed out that the delay caused significant revenue losses and left the system vulnerable to exploitation by exporters.
“Why we insisted on having the Minister of Energy here is because, on the face of it, you caused us these losses. URA couldn’t collect the money because you hadn’t done your work. Please tell us why it took so long to issue the necessary regulations,” said Sseggona.
Minister Okaasai attributed the delay to disagreements among gold exporters and the need for extensive consultations with the Cabinet. “There was disagreement among exporters of gold, which delayed the creation of a statutory instrument,” he noted.
However, Sseggona rejected this explanation, questioning when Ugandans have ever unanimously agreed on any tax measures. He demanded to know who should be held accountable for the Shs47 billion loss.
“It took you 11 months of consultations to come up with another instrument. Have Ugandans ever agreed to pay a particular tax? Who is responsible for this loss? The government empowered you to bring in revenue. Minister Kasaija wrote pleading for the instrument to bring in money, but you delayed,” remarked Sseggona.
Sseggona further questioned the role of the Ugandan people in this loss and who the Minister consulted during the delay. This led to suspicions that the Minister might not be telling the truth, as Minister of Finance Matia Kasaija, a Cabinet member, had not disclosed any Cabinet-level consultations on the gold tax.
Minister Okaasai initially protested taking an oath, insisting he had committed no crime. “What is the essence of that oath? I decline to take the oath. You said you can arrest me, for what crime? You are threatening to arrest me,” he stated. He later agreed to take the oath, opening the floor to more questions from MPs.
Yusuf Nsibambi (Mawokota South) asked the Minister to clarify whether gold exporters were allowed to trade without paying taxes during the 11-month period. “Looking at the loss and the fact that we have competent people ensuring no loss, what happened in that period? Did you stop exports or were people exporting without paying any royalties and revenue?” asked Nsibambi.
