LONG DUE! URA to start implementation of gold levy tax
Following the signing of the Mining and Minerals Export Levy on Refined Gold Regulations 2023, the stage has been set for Uganda Revenue Authority (URA) to start the implementation of the golf tax almost two years after the tax was passed into law by Parliament.
The latest development was made public through the official Twitter handle of the Ministry of Energy and Ministry Development through a notice reading, “The Minister of Energy and Mineral Development, Ruth Nankabirwa has signed the Mining and Minerals (Export Levy on Refined Gold) Regulation 2023. URA is now authorised to collect a US$200 levy per kilogram of refined gold exported from the country.”
It should be recalled that in April 2021, Parliament imposed a 5% levy on each kilogram of refined gold and a 10% levy on each kilogram of unrefined gold exported out of Uganda.
The Ministry of Finance had initially proposed to Parliament amend the Mining Act, 2003 to impose a USD200 export levy per kilogram on processed gold and unprocessed minerals, however, this was rejected by MPs who said the charge would be hard to implement and instead, Parliament approved 5% for processed and 10% unprocessed gold exports.
The latest signing into the new regulations comes at the time Auditor General, John Muwanga in his December 2022 report queried the failure by URA to collect gold tax to a tune of Shs340Bn from gold exporters, despite the players in the industry reaping Shs.29Trn from the precious mineral.
The report highlighted, “A total of Shs340Bn in taxes had not been collected from Gold exports valued at Shs6.92Trn for the year under review Management attributed non collection to the Minister’s statutory guidance of staying the implementation of the 5% export levy.”
Muwanga urged the respective Ministries of Finance as well as the Ministry of Energy and Mineral Development to expedite the process of regulations on the implementation of the new taxes imposed on gold exports.
Following the passing into law the gold tax Levy, Uganda witnessed a sharp decline in gold exports, with statistics from Bank of Uganda on the composition of exports values and volumes indicating that gold exports declined to just US$200.64M about Shs740.835Bn in 2022, up from US$1.819Bn equivalent to Shs6. 717Trn of gold exports in 2020 before the levy was imposed.
The current cost of gold per kilo on the global market stands at US$59,004.658 equivalent to Shs217,787,510.
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