Business owners in Nebbi District have been urged to embrace proper bookkeeping, hire professional accountants and file timely tax returns to avoid heavy tax bills and accumulated arrears imposed by the Uganda Revenue Authority (URA).
The call was made during a business stakeholders’ meeting organised by Vurra pa Judongo in Nebbi to gather traders’ grievances ahead of a planned dialogue with URA.
The meeting follows months of complaints from business owners over what they describe as excessive estimated taxes and accumulated liabilities.
Vurra pa Judongo said its preliminary findings indicated that many affected businesses had significant turnovers but lacked proper books of accounts, did not engage professional accountants to prepare and file their returns, and often failed to attend tax education meetings.
Organisers said the meeting was intended to establish the extent of the problem and compile traders’ concerns for engagement with URA.
Dr Jakor Oryema, chairperson of the Health Committee of the Elders Forum, who represented Canon Vasco Kura, chairperson of the Vurra pa Judongo Elders Forum, said the organisation decided to intervene after meeting some of the affected traders.
“We previously held a meeting with some prominent traders who were recently slapped with very hefty taxes for failing to file returns,” Oryema said.
He said some businesses had already closed while others were struggling to recover.
“Some businesses closed as a result of URA tax collection exercise. But we believe the grievances of these traders can be channeled to URA,” he added.
Oryema said the wider meeting was intended to gather accurate information from traders so the forum could engage URA based on documented grievances rather than rumours.
A key concern raised at the meeting was presumptive tax, a simplified income tax regime for eligible small businesses whose annual gross turnover exceeds Shs10 million but does not exceed Shs150 million.
Under URA’s published guidance, businesses with annual turnover not exceeding Shs10 million generally pay no presumptive tax. For eligible businesses above that threshold, the amount payable depends on their turnover and whether they maintain the required records.
Businesses with records are taxed using turnover-based calculations, while those without records are subject to fixed amounts determined by their turnover bands.
The system does not generally allow deductions for business expenses and losses in calculating presumptive tax.
In Nebbi, Vurra pa Judongo said inadequate record-keeping was a major concern among traders facing tax assessments.
Richard Oyirwoth, chairperson of the Business Community in Nebbi, said many traders relied on loans and suppliers to maintain their stocks but paid insufficient attention to financial records and tax compliance.
“Most of our traders rely on loans and suppliers for business stock but their record keeping and tax compliance is wanting. They don't know that their accounts can be frozen anytime for non-tax compliance,” Oyirwoth said.
Traders have also questioned assessments they believe overstate their actual business activity. They argue that estimates based on factors such as shop size, stock levels, location and the number of employees may not accurately reflect annual sales, particularly for businesses whose performance fluctuates.
The concerns are especially significant in Greater Nebbi and the wider West Nile region, where some traders depend on cross-border commerce with the Democratic Republic of Congo and South Sudan.
Oyirwoth said many businesses operated in difficult and unpredictable conditions, with seasonal trade and changing demand affecting their earnings.
He added that some traders were reluctant to seek assistance or disclose their concerns about tax assessments because they feared exposing details of their businesses.
“Most traders neither take advice nor open up on overstated taxes by URA because they think people will know more about their businesses, hence dying in silence,” he said.
Oyirwoth also expressed concern about low participation in tax education programmes.
He said the Tax Appeals Tribunal had recently held a sensitisation meeting in Nebbi to explain how taxpayers could challenge assessments, but many prominent business owners did not attend.
“Tax Appeals Tribunal recently held a meeting here in Nebbi but it was disappointing that most of the prominent members failed to show up,” he said.
Oyirwoth said Greater Nebbi had numerous grievances over presumptive tax but that, according to his account, none had been formally filed with the tribunal in Arua, despite the Shs22,000 application fee.
The Tax Appeals Tribunal is a quasi-judicial body that reviews taxation decisions involving URA. A taxpayer seeking a review must generally apply within 30 days of receiving the relevant taxation decision, although the tribunal may grant an extension under the law.
Applicants must also meet the applicable statutory requirements, including the payment of 30% of the disputed tax in cases where that requirement applies.
Jennifer Vidda, the Nebbi District Commercial Officer, said her office had been sensitising business owners and building their capacity to maintain proper financial records.
She said bookkeeping was important not only for tax compliance but also for business growth and access to credit.
“When you keep and maintain proper records, you avoid instances of being slapped with high taxes by URA without basic calculations,” Vidda said.
“When you have good records as a business person, you have a higher chance to obtain credit from lending institutions to strengthen your businesses.”
She urged traders in Greater Nebbi to maintain accurate records and seek professional assistance when preparing and filing tax returns.
Vurra pa Judongo said it would compile views from the business community into a position paper for a structured dialogue with URA, with the aim of resolving outstanding grievances and helping traders improve compliance to prevent similar disputes in the future.