KAMPALA, UGANDA — The Uganda Revenue Authority (URA) has recently destroyed 36 tonnes of contraband cigarettes valued at Shs 7 billion in unpaid taxes, reinforcing its commitment to cracking down on tax evasion. These cigarettes were seized from various parts of the country, predominantly smuggled through the northern route from Kenya and South Sudan into the Ugandan market.
According to URA, Uganda loses an estimated Shs 30 billion annually due to the illicit cigarette trade, a sector that has become highly profitable for smugglers.
Moses Kyomuhendo, the Manager of Enforcement Operations for the central region at URA, explained that the contraband cigarettes were confiscated across different regions for failing to meet the required legal standards for sale in Uganda. These standards include the presence of a tax stamp, which verifies that the duty has been paid.
The Tobacco Control Act of 2015 stipulates that all tobacco products sold in Uganda must display health warnings occupying no less than 65 percent of the packaging’s principal display area.
Smuggled cigarettes undermine the local market by being sold at a fraction of the price, significantly undercutting those that comply with the regulations.
Kyomuhendo highlighted that the volume of smuggled cigarettes, when compared to those that pay taxes, is nearly half of the market’s total value.
URA’s enforcement teams are focusing on this issue to eliminate the problem, with brands such as Supermatch, Business Royal, Platinum, Oris, Blue, and others among those destroyed in the recent operations.
“We have a lot of illicit cigarettes on the market, and these eat into the genuine market of the genuine people who are paying taxes, like the British American Tobacco Company (BAT), even those others that are manufactured within the country,” he said.
The contraband cigarettes were destroyed at the Nakasongola destruction facility, a secure site guarded by the Uganda People’s Defence Forces (UPDF). URA selected this facility to ensure the illicit goods are fully disposed of and do not re-enter the market.
“We want to ensure that genuine companies that are paying taxes remain in business for our country to gain in terms of the taxes that we are collecting and protect the health of Ugandans. Consuming a product that is not labelled with health warnings can be dangerous to the health of a person. We want Ugandans to know that once I consume cigarettes, I will get sick,” he said.
URA has urged all Ugandans to report any cigarettes found in shops lacking health warnings or tax stamps to their enforcement teams. This will help ensure that only regulated products are sold on the market and that taxes are paid, benefiting all Ugandans.
“We arrested and prosecuted a number of culprits while others have been convicted and sentenced. When we even get you conveying this cigarette, whether in a vehicle, truck, motorcycle, or bicycle, we confiscate the means of conveyance to ensure that there is a maximum penalty given to such offenders,” he said.
He further stated that the maximum penalty for a vehicle involved in smuggling is no less than $5,000. For repeat offenders, the government reserves the right to confiscate the means of conveyance, and several vehicles have already been forfeited due to involvement in cigarette smuggling.
