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Friday, November 18th, 2022

It appears that everything is going digital, and taxes are no exception. With this said, if you are in business and deal with the sale of excise goods then you are in this is important for you to note. URA has encouraged every manufacturer, importer, distributor, agent or trader of particular goods to ensure all stock of goods bears a Digital Tax Stamp. These goods include goods such as beer, soda, bottled water, wines, spirits, tobacco products, sugar, cement, cooking oil, juices, and alcoholic, non-alcoholic and fermented beverages. All these products have been gazetted for public knowledge. In case you are wondering what a digital tax stamp is, we are here to help you out. Digital tax stamps are unique labels applied on packages of products which contain security features and codes to prevent counterfeiting of products and also enable track and trace capabilities, the main purpose of this was to allow consumers/customers to consume authentic products and protect them from any subsidised products.

Objectives for the introduction of Digital Tax Stamps.

i) To protect government revenues
ii) To combat trade in counterfeit goods
iii) To enhance fair competition in the market
iv) To provide statistical data for both tax policy and administration.

Overall the main reason why digital tax stamps were introduced is to combat tax fraud within the country, however, this introduction comes with a few implications. The major one would be who would bear the cost implications that come with this new introduction. Digital tax stamps have been shown to have a few negative effects on firm sales revenues and Government excise tax revenues in the first year of post-digital tax stamp introduction. This was due to implementation challenges and delays in embracing the new technology. With these findings, the majority of the burden of implementing these stamps lies on the manufacturer.

How to register for a digital tax stamp.

i) To qualify, a manufacturer and importer should be registered for excise duty
ii) Manufacturer or importer must be registered for URA and goods should be certified by UNBS
iii) All registration will be done on the URA portal, all applicants should have a TIN.
iv) A manufacturer or importer needs to register their product.
v) Once this is done, the manufacturer or importer should order the stamps for each product. An approval notice from URA will be sent.

In case a manufacturer or importer has products that do not possess these stamps, they are advised by URA to dispose of said products or take steps to place stamps on desired products.