Uganda starts digital tax stamp roll-out

The Uganda Revenue Authority says it will start implementing a new digital tax stamp system with the aim of fighting counterfeiting and smuggling and bolster tax revenues.

The new tax stamps – which are tamper-proof paper stamps that include traceability and security features provided by Swiss company SICPA – will be applied to water, beer, soda, juices, cigarettes and other soft drinks over the course of the 2019/2020 fiscal year, according to local media reports.

The implementation has proved to be controversial, however. A legal challenge has been filed seeking to overturn the contract awarded to SICPA. While opposition to the move has come from the Uganda Manufacturers Association, which claims it will hike costs for local producers.

Last year, the Ugandan government put the roll-out on hold while the wrangling played out, despite reports that more than 50 per cent of goods on the Ugandan market are counterfeit or substandard.