The system has been undergoing a phase one process of implementation, where few products like cigarettes were targeted. Ahead of the rollout to more products, producers and importers are welcoming the move by the government because it will protect the genuine ones against counterfeiters and smugglers.
Manufacturers and importers of beverages and cigarettes have
five days to have their products stamped with the Digital Tax Stamp (DTS), or
their goods will not be on the market. The DTS is a machine-readable stamp put on a package of a
product to reveal details of the real manufacturer of the product when scanned.
The Uganda National Bureau of Standards and the Uganda Revenue Authorities
are charged with enforcing the initiative that is aimed at catching smugglers,
counterfeiters and tax evaders. The authorities are able to find out whether or not the
product went through all the quality assurance procedures during production and
if the due taxes have been paid.
The system has been undergoing a phase one process of
implementation, where few products like cigarettes were targeted. Ahead of the rollout to more products, producers and importers
are welcoming the move by the government because it will protect the genuine
ones against counterfeiters and smugglers.
However, they say, the timing of the enforcement is bad at the
time when the manufacturers are facing difficulties raising up their businesses
after the effects of the covid-19 pandemic. URA's Public Relations Manager Ian
Rumanyika urges the concerned businesspeople to comply before October 1,
because their products will not be allowed on the market.
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However, the business community says the government still has
many more important things to do, including helping formalize SMEs which
dominate the private sector before introducing costly measures like DTS. Kampala City Traders Association Spokesman Issa Sekitto says that because of the pandemic, some traders still
have stocks purchased before the directive on digital stamps.
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The importers have also warned that the targeted products are
going to see prices increase if the government insists on leaving the burden of
the cost onto the producers and importers, who will then have to transfer the
costs onto the consumer. They say the cost is too high.
However, URA’s Head of Corporate and Public Affairs, Vincent
Seruma says the cost is minimal, adding that the piloted products have not
undergone price increases attributable to the stamp costs.
On why the government did not strengthen the UNBS quality mark
instead of introducing a new cost, Seruma says the DTS serves more than one
purpose, including traceability of the product, quality and fight against
illicit trade, as well as ensuring revenue protection.