Uganda's digital tax stamps (DTS): status, costs and findings

What the stamps are

URA describes the Digital Tracking Solution as a track and trace platform. It sends production and import data to URA and the Uganda National Bureau of Standards ¹. URA says it brought in DTS to tackle suppressed production and import figures, suppressed excise duty, illicit trade and smuggling ¹.

Local manufacturers and importers of products named by the Commissioner in a gazette notice must apply stamps. URA says such products are not allowed on the Ugandan market without them ¹. Goods for export do not need stamps but must carry certified customs export documents ¹.

Rollout and goods covered

URA says it began implementing DTS in November 2019 ². Daily Monitor reported that the first phase covered water, beer, soda, juices, cigarettes and other soft drinks ³.

URA later added cooking oil, juices, alcoholic beverages, non-alcoholic beverages and fermented beverages, effective 1 May 2022, with a two month transition. Earlier gazetted goods were beer, soda, bottled water, wines, spirits, tobacco, sugar and cement ². URA said its DTS register grew from 107 taxpayers to 538 by 31 December 2021 ².

Stamp prices and penalties

URA lists these prices per stamp for manual stamping. URA says stamp payments are a business expense allowed in tax accounts ¹.

• Failing to affix a stamp: UGX 50 million or double the tax due, whichever is higher ¹.
• Possessing gazetted goods without a stamp: UGX 50 million or double the tax due ¹.
• Defacing or printing over a stamp: UGX 20 million or double the tax due ¹.
• Acquiring or selling a stamp without the Commissioner's authority: UGX 10 million or double the tax due ¹.

How to check a stamp

• Smartphone users scan the QR code with the KAKASA Digital Tracking Solution app ¹.
• Basic phone users send the code on the stamp by SMS to 8119 ¹.
• Distributors, agents and stockists use a stamp validator ¹.
• URA says transporters of unstamped goods can be held to account and their vehicles impounded ⁶.

The SICPA contract and the courts

Daily Monitor reported, in an undated online article, that URA procured SICPA, a Swiss company, in October 2018, and that SICPA was single sourced ⁴. A separate undated Daily Monitor report said URA was asked to explain why it procured SICPA without competitive bidding, and referred to a supplementary request of more than Shs103b ³.

The same report said a court stopped URA from enforcing a 1 February deadline for equipment at water, soda, beer and spirits factories. Parties agreed no one would be arrested for unstamped goods and the system would be phased in ⁴. URA Commissioner Legal Patience Tumusiime Rubagumya said URA did due diligence and "we were very comfortable that this company can actually deliver" ⁴.

A report by PwC for the Private Sector Foundation Uganda found Uganda's stamps cost on average 28.7 percent more than Kenya's. URA Commissioner General John Musinguzi Rujoki said costs should fall further, and that the SICPA contract allows gradual cost reduction ⁵. None of the sources read for this page reports an Auditor General finding on DTS.