Adjumani, (UG):- The aggrieved local contractors in the West Nile district of Adjumani have written to the Chief Administrative Officer (CAO) Adjumani Mr Oryono Grandfield Omonda demanding receipt for payment of Withholding Tax from Uganda Revenue Authority – URA amounting to over shs 442m.
“We the displeased Contractors are seeking express clarification on the deduction of withholding tax on Development Response to Displacement Impact Project (DRDIP) which by law has been fixed at 6%of the total project value,” the contractors stated in a letter dated April 6, 2024, and addressed to Adjumani CAO Oryono.
“We are conscious of the tax regime as enshrined in the 1995 Constitution of the Republic of Uganda, the procedures and processes involved in tax payment including the repercussions associated with tax evasion to our businesses and the overall impact on the development of our country,” the letter adds.
“As contractors, we understand our obligations to tax payment and the repercussions associated with tax evasion to our business and the development impact on our country”.
The enraged contractors’ have said they have been paying withholding taxes which were directly deducted from the DRDIP desk office from the financial year 2018/2019 to date but they are not in receipt of shreds of evidence showing money has been remitted to the tax body (URA).
“This state of affairs leaves us with no option but to demand your office to produce evidence of our claims not later than April 11, 2024, which is three working days”.
“Our action should be deemed as a civilized way of seeking redress, we, therefore, expect no attempts to intimidate or use underhand methods of responding to our cordial request because it may be met with the same method”.
In an interview with DailyExpress before the aggrieved contractors issued the official communication, the Adjumani CAO Mr. Oryono said contractors do not pay Withholding tax under the DRDIP project.
When pinned further he said DRDIP funds are managed by the various community sub-project officials (CPMCs), the district simply facilitates the process so payments of withholding taxes rest on the shoulders of community sub-project leaders but not the office of the CAO.
Mr. Gulam Abubakar the DRDIP desk officer candidly asserts that indeed his office has been deducting the 6% in withholding taxes directly from the accounts of community sub-projects and conceded that there have been challenges remitting the cash to URA accounts.
He vehemently denied abusing the tax cash and promised to fix the problem so that URA would issue appropriate acknowledgement documents in proof of tax cash remittances.
Speaking to journalists at his office in Adjumani town today, April 8, 2024, the Managing director of Analog Ltd Mr. Iranya Douglas said it’s indeed worrying to realize that since the financial 2021/2022 to date, he has not received feedback on payment for withholding taxes amounting to shs52m.
“Our letter to CAO Oryono Grandfield Omonda is to awaken him to the reality that we need proof or evidence of payment of Withholding tax which was deducted from our contract value so that in future we can account to URA,” he said.
The proprietor Kate Contractors Construction Company Ltd Adjumani Mr. Tiondi there must be fraud in the whole process. “Am in the know that every 15th day of the month tax agents must file returns and at the end of every year the tax body URA issues tax certificates that have not been reflected in their email accounts and SMS message alerts.
The disgruntled contractors numbering 10 have vowed to take serious appropriate actions to ensure their cash amounting to shs 442,165,123.198 is either channelled to the URA account or refunded if certainly tax fraud is proved.
“We are aware of hardcore mafias in government theft racket but we have opted to take a civilized approach only if the CAO’s office will reciprocate else we are ready to adopt measures equal to or double their strength in fighting for the survival of our businesses since our progress is measured in profits not mislays”.
They affirmed that nobody will blindfold them or divert their attention since their demand is premised on the evidence of payment of withholding tax not whether contractors are exempt from paying withholding tax under the DRDIP project.
The multi-billion DRDIP Project is bankrolled by the World Bank and the Government of Uganda is a 5 years project that officially ended on December 31, 2023, but was extended up to June 31, 2024, upon request from OPM because several infrastructural projects had not been completed by the deadline.
Adjumani district was allocated shs 56.4 bn for financing a total of 384 sub-projects and the funds were all absorbed with no notable eyebrows on corruption and political manipulations in sub-project allocations as the district council followed rules and observed the guidelines of DRDIP diligently.
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