KAMPALA-UGANDA/NEWSDAY: Leading Uganda’s Gold exporter Mr. Vinod Dadlani has welcomed the new proposed Mining and Minerals Act, 2022 amendment Bill and called for more engagements between dealers and the government.
The new bill seeks to impose a new levy that government says is meant to avoid loss of revenue. Sub regulation one of the bill stipulates that there shall a levy to be charged on processed gold at the rate of United States Dollars two hundred per kilogram, which is exported out of Uganda.
Under the Bill, the Mining (Amendment) Bill 2021, other unprocessed mineral exports will be subjected to a 1 per cent levy for every kilogram. The Bill is before the Parliament awaiting deliberations. It will apply to gold and other minerals.
Mr. Vinod Dadlani, the Chief Executive Officer (CEO) and owner of BUFUMBIRA Mining associates, points out a tax implication for larger exporters.
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Mr. Vinod is at the helm of BUFUMBIRA Mining associates since its inception in 2007.
“This is a welcome bill. Through our BUBU umbrella, we shall definitely engage the government and the President for more discussions. There are issues say in 6 tons to be exported and many others in that category. There are issues about speculators who horde gold and wait for better world prices- these hurt the economy and the flow of business,” Vinod said.
Data from Bank of Uganda indicate that gold is Uganda’s leading forex earner contributing at least 44 per cent of total export volumes.
Leading companies have weighed in on the new tax and how to go about it to balance profit making.
The Bill, aims to expand the resource envelop of government and is expected to take off in the next financial year.
Prior to the new proposals government, through the Department of Geology, has been levying a charge of 10 per cent of the value of exported precious stones, among them gold. Exporters will have to pay the levies at the point of export after assessment by Uganda Revenue Authority.
Previously, Mr John Lwere, the Uganda Export Promotion Board, export executive, said exporters had been required to apply for an export permit from the Department of Geology, which would be used to assess the consignment before shipping.
Gold exports remain highly secretive and apart from export volumes, little is known about the commodity.
It is believed that much of Uganda’s gold exports are re-exports, especially from DR Congo.
Uganda’s gold export earnings for the past five years have been rapidly increasing with Bank of Uganda reporting cumulative gold exports between February 2020 and February 2021, as $2b (Shs7.6 trillion) which was at least 44 per cent of $4.57b total export earnings.
However, it is not clear how much of the exported gold was mined within Uganda.
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