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Which goods does Uganda Revenue Authority exempt from taxation?

Wednesday, 27th April, 2011

Since the economic situation started biting hard with the value of money declining and buying fewer items, many have been forced to adjust their budgets while others have decided to take to the streets in protest. Others have demanded for government to cut taxes and exempt some goods from taxes but it is important to understand what tax exemptions are and how they arise.

Tax exemptions are provided for under section 21 of the Income Tax Act, the Value Added Tax Act and the East African Customs Management Act (EACMA).

According to the VAT Act, a supply of goods or services is exempt if it is specified in the second schedule of the same Act.

A taxable supply is a supply of goods or services, other than an exempt supply, made by a taxable person for consideration as part of his or her business activities.

For a supply to be considered taxable, it must not be listed among the exempt supplies listed in the Second Schedule of the VAT Act. This taxable supply has to be made by a taxable person who is supplying to get a consideration (make a profit from it).

The VAT Act (Section 20) defines an exempt import if the goods being imported are exempt from customs duty as stated in the Fifth Schedule of the 2004 East African Community Customs Management Act or would be exempt had they been supplied in Uganda.

The list of exempt supplies under the second schedule of the VAT Act is on the URA website (http://ura.go.ug) under the Tax Laws. Some of the exempted supplies include unprocessed foodstuffs, unprocessed agricultural products, postage stamps, supply of financial services, supply of insurance services, unimproved land, education services and supply of social welfare services amongst others.

The other supplies that are exempt include lifejackets, lifesaving gear, headgear and speed governors.

Under the Income Tax Act, there are many incomes that are exempt from tax like income of a listed institution (first schedule of the Act), income of any organization or entitled to privilege under the Diplomatic privileges Act to the extent provided in the regulations and orders made under that Act and income of any local authority amongst others.

In the Fifth Schedule of the 2004 East African Community Customs Management Act (EACCMA), there are a number of items which are exempt from tax like goods for use by Presidents of the partner states, all goods including materials, supplies, equipment, machinery and motor vehicles for the official use of partner states’ armed forces.

The other items exempted from tax under the EACCMA are goods and equipment for use in aid funded projects, one motor vehicle and spare parts for each rally driver amongst many other beneficiaries.

Peter Kaujju
Public & Corporate Affairs, URA

Comments for Which goods does Uganda Revenue Authority exempt from taxation?

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Aug 27, 2014
VAT 18% EXEMPT NEW
by: Anonymous

On mon 25/08/014 URA at 7;45am announced on Capital radio that agricultural in puts and animal feeds,poultry are exempted from VAT as read in the budget of 2014/15 but why is it not out in the news papers since not every one was tuned on that station!?
I need clarity
Thanx

Stevenson

Jun 24, 2014
Tax Policies NEW
by: Musawo K

As of the 2014/2015 Budget, all Agro machinery will be VAT taxable. So if you wanna import tractors, mills, ploughs etc you will be taxed.

Any donations (equipment, materials etc) to a non-profit (aka NGO) that is FULLY REGISTERED AND RECOGINZED AS A NGO in Uganda are tax free items. However, the bureaucracy of some of these customs agents (whether it's due to ignorance or just stubbornness) will insist that you pay taxes. So get an aggressive attorney in Uganda (I use CR Amanya Advocates in Kampala)(www.cramanya.com) to help you fight for your tax rights.

May 31, 2014
import duty NEW
by: Duncan Ssekajigo

are imported agricultural tools and machinery exempt from import duty in uganda. thanks e-mail: duncanssekajigo@gmail.com

May 01, 2014
Jeep Cherokee PCM Engine Computer NEW
by: Moses

Would you tax me when I import the engine computer for my car?

Apr 06, 2014
Tractor import NEW
by: b Moses

I would like to know wether Agricultural tractors imported are taxed or not and if taxed whats the formulea used? You can replay to: moses.businge@eabl.com

Apr 06, 2014
Tractor import NEW
by: b Moses

I would like to know wether Agricultural tractors imported are taxed or not and if taxed whats the formulea used? You can replay to: moses.businge@eabl.com

Feb 24, 2014
sma NEW
by: Ajoseph

I want to know if sma infant formulas milk whether its taxable or not

Dec 02, 2013
LED LIGHTING NEW
by: Anonymous

Hi,

I would like to start a business for LED LIGHT in Uganda, and would love to know if these type of light are VAT exempted like in Rwanda.

Thank you for replying me at chackab00715@gmail.com.

Best regards.

Sep 23, 2013
Tax exemption NEW
by: Isaac

Am working with an NGO and am trying to fundraise from foreign funders. I would like to know whether the support from abroad are taxed or are tax free?
Please advise me. It is urgent.
Thank you.

You can reply me on sebakijje.isaac@yahoo.com.

Aug 05, 2013
Inqury NEW
by: Arnold

Hullo Revenue
Am Arnold i want to know am an entrepreneur who imports medical equipment of quality from abroad i want to know if importation of medical Equipments are exempted from paying taxes.Looking Forward to a quick response.You can Email me on "drgarethnord@gmail.com"

Apr 25, 2013
Taxatin NEW
by: Musoke Hassan

Hello,we need the 2 rules of non taxable revenues.

Apr 23, 2013
Importing clean cookstoves for a school NEW
by: Anonymous

Hi -

We are a US base NGO wanting to supply institutional sized clean cookstoves to a school in Uganda. Will we have to pay custom fees and a VAT on that shipment? If so, how is it calculated?

Thanks.

Apr 09, 2013
Advise on VAT exemption for Educational Institutions NEW
by: Kirabo Joseph

Dear URA,

Recently Makerere University bought a Digital Printing machine and the supplier quoted a price VAT inclusive.

The supplier advised us that in case we needed not to pay for VAT we are required to produce a VAT exemption certificate.

Please advise us on how we can get one.

You can reply me on pmanager@admin.mak.ac.ug

or kirabojoseph@gmail.com

Looking forward to your quick response.

Regards

Joseph

Mar 20, 2012
educative and international
by: senyonga kasimu

thank you very much i have got what i wanted

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