Uganda Revenue Authority has called upon manufacturers of mattresses to apply the right harmonized system (HS) code to the items used in the manufacture of mattresses to avoid misclassification that leads to wrong assessment of taxes.

The Commissioner General, John R. Musinguzi made the call on Friday during an engagement with manufacturers in the foam sector in Sendaula Hall at URA headquarters.

The engagement resulted from an audit that unearthed the misclassification of the polycotton material which is used in the manufacture of mattress covers which led to loss of revenue to the government.

Kasule Ernest, the Chairperson Foam Sector expressed remorse for the misclassification saying, “We did not know that the HS code had changed, the reason we kept using the old HS code, but we didn’t mean to misclassify polycotton. From now onwards, we will comply.”

Musinguzi called on the manufacturers to always approach URA in case they have any queries in doing their business, telling them that they are the backbone of the Ugandan economy.

He appreciated them for bringing their issues to his attention and said that more sensitization programs will be carried out to equip them with information about the HS codes.

He requested them to document their proposals and submit them to the Ministry of Finance to make amendments to taxation laws that relate to their business.

The Executive Director of the Uganda Manufacturers Association, Dr. Ezra Muhumuza appreciated URA for being receptive and listening to manufacturers whenever called upon.

“You assess your team on the parameter of the amount of money raised. But to us clients, that is secondary. The first parameter we assess you on is the ability to listen to us,” he said.

CG also called for cooperation from the manufacturers during the auditing of their operations so as to speed up the process and reduce the time in carrying out the audits.

“If you want to build a long-lasting company, you must be tax compliant and don’t want to cut corners. My appeal to you is to cooperate during audits and use EFRIS all the time because it speeds up audits since all transactions are in the system,” said Musinguzi.

During the meeting, it was agreed that manufacturers start applying the right HS code when declaring items used in the manufacturing of mattresses to avoid misdeclaration.

By Kamugisha Kabahweza Allan