Kampala. Foreign companies and individuals operating businesses in Uganda have to meet their investment obligations by paying taxes to government instead of asking for incentives, the deputy chief executive of PricewaterhouseCoopers Southern Africa, Mr Ignatius Sehoole, has said.
Giving a key note address during the 20th annual seminar of the Institute of Certified Public Accountants of Uganda in Entebbe last week, Mr Sehoole, said: “Foreign companies must abide by the laws of the country they are operating in, so foreign companies operating in Uganda have got to pay required taxes as stipulated in the law.”
By law world over, companies operating in foreign countries pay income taxes to the country in which those profits were earned out of their investment, but in Uganda many foreign companies/investors tend to ask for tax incentives.
Effective domestic resource mobilisation is at the core of financing for sustainable development in a Least Developed Country like Uganda.
But efforts to raise domestic resources through taxation are often constrained by tax incentives (holidays) evasion and avoidance and illicit financial flows.
Mr Sehoole said Uganda and other African countries offers fertile ground for investments to foreign companies/offshore investors and yet corporates are busy taking wealth out of African countries.
He added that there is need to change the auditing approach to detect fraud while at the same compelling corporates to obey the investment requirements.
Despite increased FDI inflows in Uganda and other African countries over the years, there is high incidence of corruption cases with some misguided people saying corruption holds people together.
However, Mr Sehoole said: “No country/society needs corruption to hold them together and corruption practices should not be entertained by the African governments because it is destructive to national development.”