Uganda Revenue Authority (URA) has confiscated over 2000 unstamped products from Bee De Eff (BDF) Spirits Limited, which makes gins and waragis. The products confiscated include Sports gin, Spark Waragi, and Captain Cherry which were distributed in the night.
The URA enforcement operation informed press present that the product is potentially harmful to consumers’ health and also possess an unfair play field for compliant taxpayers.
Ian M. Rumanyika, the URA Ag. Assistant Commissioner Public and Corporate Affairs called upon the public to look out for products that are not stamped for they could pause health and safety challenges to their bodies.
It has also come to the Taxman’s notice that some manufacturers and importers have resorted to forging these stamps from printing facilities but these will be countered by the stamp verifier technologies.
By March 2021, URA had recovered over UGX 3.5bn in revenue as a result of netting 33 Digital Tracking Solution (DTS) flouters who were caught manufacturing, selling, exporting or distributing gazetted goods without the tax stamps. DTS was operationalised in November 2019 where six products, namely beer, soda, water, wines, spirits, and cigarettes were gazetted by the minister to apply digital tax stamps. This was mandated for both manufacturers and importers of the said goods.
After several failed attempts at manipulating the production line, some manufacturers and importers decided to outsmart the DTS system’s enforcement team by sending out products using unbranded vehicles. The URA enforcement team wondered how seemingly “clean” production lines infiltrated the market with unstamped products.
Section 19 of the Tax Procedure Code (TPC) stipulates that a penalty of UGX 50,000,000 or 50% of the value of unstamped goods whichever is higher, is served for failure to affix a digital stamp on select gazetted products.
As a result, manufacturers and importers have been tracked down and tasked to stamp their products. If unstamped products are found at the manufacturer’s premises, the premises are sealed off, owners penalised as stipulated in the law with the task to stamp products going forward.
In addition, some beverage manufacturing premises were found unworthy to pack such products for human consumption given the poor level of hygiene on display in the process of packaging their products.
The act of not affixing digital stamps to their products was very telling about the disregard for quality for their customer base as would be required by the Uganda National Bureau of Standards (UNBS).
Below are some of the products seized between February and March 2021;
Busia; 140 cartons X 24 bottles X 205mls of Forest Ice Waragi gin
117ctns X 12 bottles X 300mls of Babalo Mixed Fruit Wine
22ctns X 24 bottles X 200mls of Songa Waragi Dry Gin
Western: Fake stamps by Parambot distillers on Royal Vodka
Hoima: 100 cartons of unstamped Club One flavoured Gin
Kikagati Customs: 81 cartons of Ice and Soldier Gin
Ntuura Customs: 15 cartons of unstamped Azam Malt made in Tanzania
Madi Opei: 125 Bombas X 10 Pkts X 20 sticks of Supermatch King Size Cigarettes made in South Sudan
Masaka: 61 cartons of unstamped Nabugabo Spirit
West Nile and Northern: 10,000 bombas x 10 packets x 20 sticks of cigarettes.
A recent enforcement operation raid that focused on retailers and stockists captured many unstamped products trading on the market and below are products that were confiscated:
Spot Gin Waragi (3 cartons), City Arrow (5 cartons), Ice London Dry Gin (73 cartons), Soldier Gin (9 cartons), Ssenta Gin (349 cartons), Vinno Waragi (39 cartons), Napoleon Gin(30 cartons), Sanyuka Gin(24), Vision waragi (5 cartons), Aqua Thirsty (26 jumbo bottles), Impact Cane (21 cartons), Sabula Waragi (3 cartons), King Kane, Storms Waragi (3 cartons), Beckam Gin, Hitler African No.1 Beer, and Red Sorghum Whisky.
Notably, the DTS solution is helping to wipe out illicit trading while levelling the unfair business playfield in favour of the compliant taxpayers. With DTS, consumers are empowered to confirm that what they buy conforms to the UNBS standards. The partnership between URA and UNBS ensures that stamps are only given to certified manufactures and importers for the general safety of the consumer.
The digital tax stamp is a mark affixed to uniquely track and trace gazetted products on the market. They come in different formats such as; the direct ink print mainly on bottled water, soda and beer, the short rectangular paper stamp on cigarettes, the round paper stamp on some bottled water, soda and beer brands, and the long rectangular paper stamp which goes over the top of wine/spirit bottles.
The digital stamps are affixed onto the products upon packaging. This implies that manufacturers and importers of the gazetted products either install a stamp applicator on their production line or order for and buy the serialized stamps from URA.
For over one year now, URA has successfully registered a total of 315 businesses on DTS comprising of 247 manufacturers and 68 importers, against an initial target of 107 manufactures and 33 importers.
Earlier this year, URA started the KAKASA campaign that is sensiting both traders and consumers on several products including DTS. The public is therefore urged to look out for digital stamped products because they have unique features that can help verify legitimate products.