Representatives of various companies with AEO certificates
In international trade, one of the major challenges traders face is the lengthy clearance processes while moving goods across borders. Clearance processes are necessary to ascertain the different taxes and implement the different measures on prohibited goods, restricted goods.
However, in order to avoid these cumbersome processes, an importer needs to enroll for the Authorized Economic Operator program.
The AEO Program is a flagship trade facilitation and Supply chain security program championed by the World Customs Organization (WCO) and is currently being implemented by more than 70% of the Customs Administrations that form the membership of the WCO.
URA is one of the WCO members that has embraced this program and has been implementing it since 2009 with remarkable results.
The program is a risk management tool that works on the principle of cooperative partnership between Customs administrations, Government agencies, and the private sector (Business community). It allows Revenue Administrations to partner with Businesses that have been checked and found to be compliant and, in return, get benefits in terms of simplified procedures.
An AEO is defined by the WCO SAFE Framework of Standards as “a party involved in the international movement of goods and has been approved by or on behalf of the national Customs administration as complying with WCO or equivalent Supply chain security standards”. AEOs include, inter alia, manufacturers, importers, exporters, customs agents and brokers, carriers and transporters, consolidators, intermediaries, ports, airports, terminal operators, integrated operators, warehouses, and distributors.
For URA, the program serves to facilitate international trade, foster a culture of compliance, and reduce the cost of revenue administration. For you as a taxpayer, it comes with a wealth of benefits that could turn around the operations of your business.
The faster customs clearance processes I mentioned above are just one of the benefits you can enjoy as an AEO. AEOs also have the opportunity to self-manage their bonded warehouses.
Under this, private bond operators are allowed some degree of autonomy in the management of their warehouses, subject to regular audits by Customs to ensure that compliance levels are maintained. The risks involved are minimal, and URA has mechanisms to detect and address any noncompliance issues that may arise.
This enables businesses to access their goods 24 hours a day, seven days a week, once taxes have been paid and goods have been duly released for consumption. These operators can access their goods easily for production or trade, which improves their productivity and business efficiency. Not to forget, AEOs also get to have their tax refunds processed quicker than those of their counterparts outside the program. All of these are benefits of being tax-compliant.
How to join the program
Interested persons can express interest by writing to the Commissioner of Customs, Uganda Revenue Authority. URA will then conduct the necessary checks to confirm their validity before enrolling them in the program.
URA also has the leverage of reaching out to taxpayers who they think qualify for the program.
-The Taxman
