Gold exporters in Uganda seek review of new tax regime

Gold exporters in Uganda seek review of new tax regime on the commodity. Under the Mining (Amendment) Bill 2021, government had imposed a $200 levy on each exported kilogramme of gold.

However, the levy was revised to 5% for every kilogramme of the refined precious metal and 10% for the unprocessed. In its August Economic Performance report, the Ministry of Finance indicated that no gold had been exported in the month of July, pending a resolution of the revision of the levies.

During July, the Ministry of Finance noted that government had imposed a levy of 5% and 10% on every kilogramme of refined and unprocessed gold, respectively, which dealers had asked that are revised downwards.

Export receipts

“The exporters have requested government to revise this tax downwards and negotiations are being held to this end. Pending the conclusion of these negotiations, there were no exports of gold from Uganda in the month of July,” the report reads in part.

As result, the report noted, export receipts declined for the second consecutive month, partly due to failure to register gold exports for the first time in over six years. Gold is currently Uganda’s largest export commodity, contributing at least 44% of total export volumes, according to data from Bank of Uganda.

According to Bank of Uganda, export receipts in July declined by at least 51%, dropping to $300.3m (Shs1 trillion) compared to $455.4m (Shs1.6 trillion) in June as a result of failure to export gold during the period. This, the Central Bank said, was the lowest earnings Uganda had received from exports since May last year, which had declined to $290m due to Covid-19 related disruptions.