Ignorance of taxation laws hindering revenue collection from SMEs, say experts
One of the biggest challenges facing the government is collecting tax revenue from the Small and Medium Enterprises (SMEs).
Failing to file a tax return and pay taxes when they are due is illegal and if found guilty, action can be taken against the individual or organisation involved.
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Speaking during the Tax Baraza organized by Uganda Revenue Authority(URA), Gyaviira Busulwa, a tax expert, said one of the key reasons why SMEs do not pay taxes is that they are ignorant about taxation laws.
“Many SMEs have tendencies of denying themselves the knowledge of tax knowledge. They think that they are hiding from the taxman, yet they are hiding from getting aware of what to do. The essence about taxation is being aware of taxation laws,”he said.
Apart from creating awareness among the business community, Busulwa asked URA to exhibit professionalism in handling tax matters especially with SMEs who are unaware of some taxation laws and yet they do not have capacity to hire taxation experts.
Thaddeus Naggenda from Kampala City Traders Association (KACITA) said It is very important for businesses to formalize.
"We are trying to see how we can carry out a sensitisation drive. We are formalising a work plan which is going to cover the whole of Uganda. We are going to identify the leaders of businesses because if the leaders know their responsibilities towards their tax obligations, clearly they can assist their members," he said.
Hafsa Seguya from Uganda Revenue Authority (URA) tasked the business community to file their tax returns for the financial year 2021/2022.
She said this shall boost self-assessment skills for business owners and enable the taxman to operate effectively.
She told The Nile Post that it is very important for the business community to carry out an assessment on how their business have performed in terms of profit, loss and expenditure.
