The Bank of Uganda has received a letter from the Uganda Revenue Authority (URA) requesting that commercial banks and mobile money banking providers publish a list of their agents in order to facilitate efficient tax collection.
The URA commissioner general, Mr. John Musinguzi, stated in a letter dated February 23 that many agents aren’t registered to pay taxes as a result of their research of banking and mobile money financial services.
“In a bid to ensure tax compliance, we appeal to you to ensure that all commercial banks and mobile money financial service providers operating digital wallets register for taxes in accordance with the law and require them to regularly publish and update the lists of their banking and mobile money agents on their websites,” In a letter to the governor of the Bank of Uganda, Mr. Musinguzi.
Each transaction that mobile money agents complete is meant to result in a commission. As a withdrawing tax, URA deducts 6% from each commission transaction. The money is gathered by financial organizations, who then send it to the tax collectors.
According to Mr. Ibrahim Bbosa, assistant commissioner for public corporate affairs at URA, the exercise aims to close gaps in tax compliance, particularly in low-compliance industries.
“There are some agents who haven’t been registered for tax meaning either they don’t have TIN numbers or when the telecoms withdraw, they don’t submit the revenue with identifiable TIN numbers,” Mr Bbosa said.
The CEO of MTN Mobile Money, Mr. Richard Yego, stated yesterday that his corporation had received a letter along those lines and that they would abide by URA guidelines.
“We have been withdrawing. It is just we have not been attaching the TIN (Tax Identification Number)….,” Mr Yego said, adding that before, it wasn’t a requirement.
According to him, they must inform their agents on the new tax laws, and the process could take some time. Almost 200,000 MTN agents work all throughout the nation.