Uganda Duties and Taxes Exemption by ufl29091

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									Uganda D&T Exemption and Customs Clearance
As at 2007-08-07




                         Uganda Duties and Taxes Exemption
                          And Customs Clearance Process

The following is information on the duties and taxes exemption process and customs
clearance process in Uganda. As the two are largely intertwined, they are explained together.
However, as an excerpt, here is how to obtain a duties and taxes exemption:


          WFP imports are duty and tax exempt. A tax exemption certificate is usually
          applied for on case by case basis and appended to the entry at the time of
          lodgment, in lieu of payments to the bank for non-food items. On request, WFP
          applies Statutory Instruments enshrined in the Finance Bill for customs
          clearance of Food Items.

          In order to obtain this certificate for non-food items the following applies:

          1. A triplicate application must be made to the Protocol Office of the Ministry
             of Foreign Affairs using the appropriate form (see Annex A).

          2. The Permanent Secretary will approve/reject the application. Once done,
             one copy is retained by the Ministry, one copy is forwarded by them to the
             Customs and Excise Department and one copy is returned to WFP to go
             along with the other supporting documents related to the importation.

          3. When the goods are being declared and cleared with Customs, WFP must
             present the exemption certificate together with any other required
             documents. Included in these required documents it must show that WFP
             is the consignee of the goods.

          Notes:
          1. The Ugandan Revenue Authority and the Ministry of Foreign Affairs has
             controls in place to monitor the goods being imported in relation to the
             exemption certificates approved.
          2. An exemption must be applied for before the arrival of the goods in the
             country.
          3. The total time required for obtaining a duties and taxes exemption
             certificate is at minimum 3 working days, but it depends on the workload of
             the approving officer.

          In the case of food items, WFP has blanket coverage and only needs to present
          a declaration to the Uganda Revenue Authority (Customs) with the supporting
          import documentation.


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                                            REQUIRED DOCUMENTS


Bill of Entry and Supporting Documents

          Declaration of goods to Customs is done on a bill of entry (SAD). The following are
          declared on the entry:
          -       Consignor (Exporter)
          -       Consignee
          -       Clearing Agent
          -       Origin
Uganda D&T Exemption and Customs Clearance
As at 2007-08-07



         -        Value
         -        Currency Code
         -        Commodity Code (HSC) description of goods
         -        Quantity
         -        Customs Procedure Code
         -        Payment Account (ASYCUDA++)

         In Uganda two ASYCUDA (Automated System for Customs Data) Versions are in use
         namely, ASYCUDA 2.7 and ASYCUDA ++. The latter system allows importers to do
         self assessment of duty for their goods while in the former system duty assessment is
         done by customs.

         Under both Systems, the Customs Clearing Agent prepares a work sheet indicating
         all the features listed above and takes it to the Direct Trader Input (DTI) centre for
         registration. A print out of the entry is then produced with an entry number
         automatically allocated by the computer.

The following documents support a declaration and should be availed to the customs
        agent prior to arrival of goods.

         -        Commercial Invoice
         -        Packing list
         -        Bill of Lading/Airway Bill/Railway Consignment Notes
         -        Sales Agreement
         -        RCTD/TI
         -        Certificate of Origin
         -        Fumigation Certificate
         -        Phytosanitary Certificate
         -        Import Permits for restricted imports like drugs, arms and ammunitions,
                  fertilizers, live plants, live animals, soil etc.

         Other documents that may be attached on entries to support a declaration include:

         -        Proof of payment documents like Telegraphic transfer (TTs)
         -        Motor vehicle registration/Deregistration Certificate
         -        Letters of Credit
         -        Receipts.

         It should be noted that not all declarations must have all the above listed supporting
         documents. It depends on the nature of the import and how the transaction was
         carried out.



                                             WORK FLOW

     RECEIPT, CHECKING AND PASSING/REJECTING IMPORTATION DOCUMENTS

Receiving and Passing a Declaration

         Goods are deemed to be entered when the entry, made and signed by the owner in
         the prescribed manner, is accepted and signed by the proper officer (Customs
         Officer) and any duty due or deposit required in respect of the goods has been paid
         or security (Bond of Tax Exemption certificate) has been given for compliance with
         the law.

         Under ASYCUDA 2.7 after the entry has been captured in the computer it is stamped
         and signed by the proper officer but payment of duty is done after assessment at
         Long room. Under the ASYCUDA++ System, after the registration of the entry at a
Uganda D&T Exemption and Customs Clearance
As at 2007-08-07



         DTI, payment is done at the bank and the entry lodged at the Customs Business
         Centre (Longroom).

         WFP imports are duty and tax exempt. A tax exemption certificate is usually
         applied for on case by case basis and appended to the entry at the time of
         lodgment, in lieu of payments to the bank for non-food items. On request, WFP
         applies Statutory Instruments enshrined in the Finance Bill for customs
         clearance of Food Items.

         In order to obtain this certificate for non-food items the following applies:

         4. A triplicate application must be made to the Protocol Office of the Ministry
            of Foreign Affairs using the appropriate form (see Annex A).

         5. The Permanent Secretary will approve/reject the application. Once done,
            one copy is retained by the Ministry, one copy is forwarded by them to the
            Customs and Excise Department and one copy is returned to WFP to go
            along with the other supporting documents related to the importation.

         6. When the goods are being declared and cleared with Customs, WFP must
            present the exemption certificate together with any other required
            documents. Included in these required documents it must show that WFP
            is the consignee of the goods.

         Notes:
         4. The Ugandan Revenue Authority and the Ministry of Foreign Affairs has
            controls in place to monitor the goods being imported in relation to the
            exemption certificates approved.
         5. An exemption must be applied for before the arrival of the goods in the
            country.
         6. The total time required for obtaining a duties and taxes exemption
            certificate is at minimum 3 working days, but it depends on the workload of
            the approving officer.

         In the case of food items, WFP has blanket coverage and only needs to present
         a declaration to the Uganda Revenue Authority (Customs) with the supporting
         import documentation.


         At the Receiving/Lodgment desk the entry is face vetted. The SAD is checked for
         completeness i.e. ensuring that all the mandatory boxes are properly filled.
         Supporting documents are also checked to ensure that they relate to the declaration
         in terms of consignee, goods description, quantity, origin and currency. The
         declaration must also bear signature and stamp of a licensed Clearing Agent.

         The supporting documents must be in original form or certified true copy.
         Presenting photocopies should be adequately explained before their use is accepted.

         In case some entry requirements are not met, the officer issues a query notice to the
         clearing Agent who answers before the entry is accepted. Penalty of UGX 20,000/=
         (Twenty Thousand shillings) is levied for every query raised. Extreme care therefore
         has to be exercised while preparing the entry.

         If the declaration presented to the Receiving officer meets all the requirements, the
         officer accepts it by stamping and signing.

         Under ASYCUDA 2.7 after the entry has been received, it is forwarded to the location
         of goods (ICDs in most cases) for examination of cargo. After the cargo has been
         examined, the entry is forwarded back to Longroom for document check and
         assessment of duty.
Uganda D&T Exemption and Customs Clearance
As at 2007-08-07




         Under the ASYCUDA++ System, after the lodgment stage, the entry goes to the
         Control desk/Assessment desk. At the Control desk, selectivity is triggered and the
         entry is selected either Red (physical examination), Yellow (Document check), Blue
         (Audit) or Green (No examination). Most, if not all WFP items are selected Green.

         When the entry is selected Red then it goes for physical examination. After
         examination, the entry is brought back to Control desk for rerouting to yellow lane for
         document check.

         Green lane entries are not checked, they are assessed directly.

         At Document check the declaration is thoroughly examined. The “Mandatory” boxes
         of the SAD are thoroughly checked by the Document Check officer in relation to the
         supporting documents to ensure compliance and correctness. The verification
         account is also checked against the declaration (in case of Red lane entries).

         The mandatory boxes are:

         -        Consignee
         -        Clearing Agent
         -        Country of Origin
         -        Quantity
         -        Currency and Exchange rate
         -        Value
         -        Commodity Code (HSC)
         -        Customs Procedure Code

         It is therefore important that the above boxes of the SAD are carefully and thoroughly
         checked before an entry is passed.

         When it is found that some of the information declared on the entry is incorrect, then
         a Query Notification Form is filled and a Clearing agent asked to respond to raised
         queries.

         Mis-declaration of the commodity code is mis-description of an item and calls for a
         penalty. Therefore, at Document check stage of entry processing, a consignment can
         be seized and an offence raised.

         When a declaration is checked and found satisfactory, then the entry is passed. The
         officer endorses the values passed on the entry, indicates the valuation method
         applied, signs, prints name and date and passes over the entry to Control
         desk/Assessment desk.

         In case of ASYCUDA 2.7 System, a Payment Advice form is given at the Assessment
         desk and payment done in the bank. After payment is done, the entry is forwarded to
         the cashier for receipting and then to the Releasing Officer who prints a release order
         and then forwards the entry to the Separation desk.

         In case of ASYCUDA++ System, at the Control/Assessment desk the entry is
         rerouted Green and then forwarded to the Release desk where a release order is
         printed and attached on the entry before forwarding it to the Separation desk.

         Note: At any stage of entry processing a query can be raised.

Computation of Duty

         Time of entry determines rate of duty. Import Duty therefore is paid at the rate in
         force at the time when the goods liable to such duty are entered for home
         consumption.
Uganda D&T Exemption and Customs Clearance
As at 2007-08-07




         Where goods are entered before arrival of the Aircraft or vessel, Import duty is paid at
         the rate in force at the time of arrival of such aircraft or vessel.

         Goods are entered within 21 days after commencement of discharge in the case of
         vehicles on arrival or such further period as may be allowed by the proper officer.

         Before taxes are computed, the proper customs value for the import must be derived
         and the proper tax rates applied. Goods should therefore be correctly classified.


Entry of Exports

Introduction

         The major functions of Customs and Excise Department is to facilitate and control
         trade, enforce customs laws and regulations as well as development of national
         statistics. Successful administration of the above functions in the exportation process
         requires high level of exporter’s compliance; only when exporters declare the cargo to
         Customs in the manner that is clear and acceptable according to the Customs
         Management Act (EACCMA). The process is complete after Customs has received,
         accepted, processed and released that declaration.

Definitions

         a) Export – Means to take or cause to be taken out of a country. Exports are goods
            that taken out of the country.

         b) Entry - Introduction of the goods to be exported from the country of export
            through an exit/export station; declaration to Customs on a prescribed form called
            a Customs Bill of entry (a Single Administrative Document -SAD).

         c) Exportation - is the process of taking out home produced or manufactured or
            imported goods from one country known as the country of export, to another
            country which becomes the country of import. When such goods are declared to
            customs officers with an intention of exporting the goods they are subject to
            customs control, customs standard required documentation and released under
            customs export procedure.


Legal provision

         Before any goods are put on board any aircraft, vehicle or vessel departing to a
         foreign port, or before they are exported overland across the frontier, they must first
         be entered.
         Goods shall be deemed to be entered when an export entry is made and signed
         by the owner in the prescribed manner is accepted by the proper officer, unless
         otherwise;

         a) Prohibited or Restricted

         b) Permitted without an entry

Types of export regimes

         Types of declarations are known as Regimes. Each regime has an identification
         code. There are 4 major types of export entries, namely: Direct; Temporary; Outward
         transit and Re-export.

Examples of types of exports and export regimes
Uganda D&T Exemption and Customs Clearance
As at 2007-08-07




a) Permanent (Direct) Exports
    These are goods grown or manufactured in the country consigned for sale to another
    country without a possibility of being returned.
    a) Unbonded transit exports
    b) Bonded transit exports

b) Temporary exports
    Temporary exports are exports on a short term basis; these are goods taken from the
    country of export to a country of import with an intention of being re-imported after being
    refurbished, repaired or otherwise.

c) Outward Transit
   These are goods that were meant to only pass through the country from an originating
   country to another.

d) Re-exports
    a) Re-exports are goods formerly imported into the country but are being exported to
       another country of import or back to the country of origin.

     b) Where taxes have not been paid on the goods to be re-exported, the exporter must
        seek authority from Commissioner Customs before re-export entries are processed.
        Bond security (CB 4) is required to secure the taxes on goods until they exit the
        country.

     Such goods are bonded prior to exportation. However, with the excellent working
     relations with the Uganda Customs Authorities, WFP operates an open warehouse
     and a blanket cover memorandum that suffices for the required bonds.




                                             WORK FLOW

                                 EXPORTS ENTRY PROCEDURE

Registration of Export entries

     a) Export entries are captured or registered under the respective regime codes through
        Direct Trader Input (DTI)
     a) Export bill of entry Single Administrative Document (SAD) print out is physically
        lodged at the nearest Customs Business Centre (CBC)

CBC Assessment procedure (internal)
   a) Entry and supporting documents received by i/c Exports desk CBC
   b) Physical examination of exports
   c) Listing of entries within the relevant regimes
   d) Assessment and computation of duty
   e) Generating T1 and Bond allocation (deduction)
   f) Release for export

i)       Assessment:
         This is done after vetting of entries to ensure that they conform to all the
         requirements:

     a) The physical entry lodged is crosschecked against the exact entry captured in the
        system. In terms of the entry number, consignor, consignee, agent, number of
Uganda D&T Exemption and Customs Clearance
As at 2007-08-07



           packages, values, truck number and container number in case goods are            (in a
           container) and of which size.


       b) Make sure the verification accounts are descriptive and fully endorsed by the verifying
          officer and the agent.

       c) The documents attached are vetted to ascertain that sufficient information has been
          submitted in regard to the entry in question.


ii)        Required export supporting documents
           All categories of exports require different accompanying documents that have to be
           presented with a bill of entry at Lodgment. Generally, the following documents are
           required to support the exporter’s declaration;
                Commercial Invoice
                Packing list
                Sales Agreement
                RCTD/TI (Road/rail Customs Transit Document)
                Certificate of Origin
                Fumigation Certificate
                Phytosanitary Certificate
                Export Certificates or Permits
                Receipts


iii)       Separation of the Export entries:
           Export Entries are separated into two copies:
           a) A station copy
           b) A driver’s copy which goes with the vehicle and of which is supposed to be
              presented at every check point and exit station
Uganda D&T Exemption and Customs Clearance
As at 2007-08-07



ANNEX A

								
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