How Whistle-blowers Can Eat URA’s Fat Money By Disclosing Tax Defaulters

Ian M. Rumanyika, the URA Acting Assistant Commissioner Public and Corporate Affairs 

Uganda Revenue Authority (URA) works with various stakeholders and partners to recover revenue from either ignorant or intentional tax defaulters.

The tax body acts on  verified intelligence.

Informants/ whistle-blowers who give accurate information that leads to recovery of revenue from tax defaulters are paid handsomely.

Ian M. Rumanyika, URA’s Acting Assistant Commissioner Public and Corporate Affairs says the tax body gives 5% of the revenue collected to a whistle-blower who gives accurate information about the tax defaulter.

“A whistle-blower is given 5% of the revenue we have collected from a case. For example, if you whistle-blow on a company not paying PAYE (Pay As You Earn), we work with you but you must have evidence and  the case you have reported must not be under audit. We shouldn’t have information about it,” Rumanyika explains in an exclusive interview with Business Focus.

Further explaining the importance of a whistle-blower in URA’s recovery of revenue, Rumanyika says: “We keep your confidentiality, we protect you as an informer because you have a right to be protected. We investigate, enforce and collect from the taxpayer.”

URA has in recent months recovered Shs3.5 billion in revenue from companies flouting Digital Tracking Solution (DTS)  guidelines.

However, non-compliant taxpayers have an opportunity to avoid embarrassment, fines and penalties by embracing Voluntary Disclosure Program. 

Voluntary Disclosure is a process where a taxpayer discloses information about his/her business to URA without any prompting by any action or threat of action by URA.

 Rumanyika says that when a taxpayer enters into an agreement with the Commissioner to pay the outstanding unpaid tax, he or she shall not be required to pay any interest or fine due.

URA has collected Shs18.6bn in tax revenue from Voluntary Disclosure Program in just five months.

Rumanyika notes that the tax body has also collected Shs500bn from Alternative Dispute Resolution (ADR) in the last six months.

ADR is the procedure for settling disputes without litigation, such as arbitration, mediation, or negotiation

ADR also allows the parties to come up with more creative solutions that a court may not be legally allowed to impose.

Rumanyika says URA is now more of a business enabler, the reason why enforcement including taking legal action against some unscrupulous taxpayers is a last resort.

 “Voluntary Disclosure is more flexible and cost-efficient because it does away with litigation costs, time-effective, and gives both parties more control over the process and the results unlike arbitration,” he says.

He adds that the Voluntary Disclosure Program is also used to correct inaccurate or incomplete information, or to disclose information not previously reported on a tax return.

By Francis Otucu