Taxes
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African tax administrators are scheduled to meet here Nov. 18-22 to among others share experiences in curbing tax leakages through Double Taxation Agreements (DTA) that member countries have with other countries in Europe or elsewhere.

Stella Nyapendi, African Tax Administration Forum (ATAF) representative in Uganda told reporters here ahead of the meeting that Africa losses about 50 billion U.S. dollars annually through illicit financial flows. She said some multinational enterprises or wealthy individuals abuse DTA to avoid paying taxes.

“It is a figure (50 billion dollars), if we stop the leakage then we would not be asking for aid because it is bigger than the aid we are getting,” Nyapendi said.

Previously African countries, according to Nyapendi, used DTA models from Europe which ended up not being favorable and multinational enterprises used them to do transfer pricing and profit shifting among others.

ATAF, which brings together 38 member countries formulated a DTA model that countries can use to make their own. ATAF signed a memorandum of understanding with the Pan African Parliament to adopt the DTA model at the continental level.

Nyapendi said the current continental DTA is also undergoing review to incorporate new trends like the digital economy, oil and gas among others, which can be used by unscrupulous business entities to repatriate profit from Africa.

Dickson Kateshumbwa, acting head of Uganda Revenue Authority (URA), the country’s tax body said that in view of the emerging challenges where the east African country has lost money, government is currently reviewing the DTAs.

Kateshumbwa said government is using the ATAF DTA model to assess whether the DTAs Uganda has with other countries are beneficial to the country or not.

“There is a process of reviewing some of the DTAs that Uganda already signed and this is an ongoing process because we have to assess the benefit. If we signed a DTA that is one way sided, it does not benefit us as a country,” he said.

According to URA, government is currently review the DTA it has with Mauritius and Netherlands.

“Very soon we will be having changes and also getting new ones,” he said. Enditem

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