UGANDA, Kampala | Real Muloodi News | The Uganda Revenue Authority (URA) has issued a notice emphasising that failing to pay stamp duty on agreements related to property purchase and transfer within Uganda is a punishable offence.
According to Section Three of the Stamp Duty Act, 2014, stamp duty is levied on the transfer or purchase of property, including land, with the responsibility falling on the person drawing, making, or executing the instrument.
In the notice, URA highlights the requirement for individuals involved in property purchases or transfers to submit the agreement or memorandum of agreement, along with the transfer and consent forms, to URA for stamp duty assessment, payment, barcoding, and the generation of a stamp certificate.
“Therefore, any person who purchases or transfers property should present the agreement or memorandum of agreement together with the transfer and consent forms to URA for stamp duty assessment, payment, barcoding, and generation of stamp certificate,” the notice reads in part.
The notice outlines the stamp duty rates: USh15,000 for each agreement or memorandum of agreement, and a rate of 1.5% of the total value of the land for land transfers, as determined by the chief government valuer.
URA’s manager of public and corporate affairs, Mr Robert Wamala Lumanyika, highlighted that other properties subject to stamp duty include loan agreements, a Memorandum of Understanding, and bond agreements.
This notice comes as URA faces pressure to increase its tax revenue to Gross Domestic Product (GDP) ratio, which has remained stagnant at around 13% in recent years despite growing demands.
President Museveni, during the Budget reading, expressed dissatisfaction with URA’s failure to expand the tax base despite existing potential in various sectors.
The Ministry of Finance Permanent Secretary and Secretary to the Treasury, Ramathan Ggoobi, echoed the need for increased tax mobilisation through enhanced compliance in sectors such as agriculture.
URA has previously warned stakeholders in agriculture, music, arts, and drama to fulfil their tax obligations, with penalties and imprisonment awaiting those found guilty of non-compliance.
The notice clarifies that any instrument subject to stamp duty will not be admissible as evidence unless the duty is paid and the instrument is properly stamped.
Failing to pay the required duty is deemed an offence, with potential consequences including a fine of 100 currency points (equivalent to USh2 million), imprisonment for up to six months, or both.
In a separate notice, URA also highlighted that all professional bodies are obliged by law to voluntarily declare all professional certificate licenses executed within Uganda to the commissioner of domestic taxes for tax assessment.
The Stamp Duty Act introduced a rate of USh100,000 for professional certificates or licenses in the 2020 amendments.
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