BUY UGANDA VANILLA BEANS                                                                                                                                SOYBEAN OIL 

Heritage Oil Loses USD30M Uganda Tax Appeal


Heritage Oil and Gas is to pay USD30 Million as assessed tax by the Uganda Revenue Authority (URA) according to the ruling of the Tax appeals Tribunal.

The Tax Tribunal observed that Heritage Oil sold to Tullow Oil a bundle of rights and interests under the purchase sale agreement and therefore earned income.

Heritage Oil had opposed, arguing that the payment of USD100 Million was not a sale of immovable property to fall under the Uganda Income Tax Act and therefore , not taxable.

Heritage oil further contended that the payment rose out of a settlement of a disputed contractual claim and not out on activity attributed to Uganda.

"In the absence of any deductions that were incurred by Heritage Oil to improve the asset, the Uganda Revenue Authority rightfully assessed the tax as USD 30 Million having applied the 30 percent tax rate to USD 100 Million." The Tax Tribunal Chaired by Asa Mugenyi ruled.

Heritage Oil and Gas had petitioned the Tribunal, challenging as unlawful the income tax assessed by Uganda Revenue Authority from a settlement of USD 100 million paid by Tullow Oil for Heritage's 50 percent stake.

Heritage Oil had argued that since the payment was made in Mauritius in fulfillment of Tullow's obligations in the sale and purchase agreement, Uganda Revenue Authority had no powers to tax the money.

According to records, Heritage Oil was incorporated in the Bahamas and registered in Mauritius, where it files its tax returns. It is also registered in Uganda.

Any income attributable to any activity, which occurs in Uganda, is Taxable, according to the ruling that was delivered on the 7th December.

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