Government through the Ministry of Finance will start issuing estimates of rent tax to be paid by land lords based on the rating of the rental property in a specific location.
The revelation was made by the Commissioner General of the Uganda Revenue Authority (URA) Doris Akol while speaking at the Budget Review Breakfast at Hotel Africana.
The Commissioner General said the new regulation which will take action starting with July 1, discount 2017 will apply to persons who have intentionally evaded the tax and those whose tax returns are misleading or contested by the commissioner.
She said; “a lot of landlords are not complying with the law and are declaring less tax returns than the actual amount that they are getting from rentals. This means that we are not getting as much as expected from this sector.”
“This new policy will see that people who own land in the same premises will have to pay the same amount of tax as determined by the Ministry incase we feel that they are not telling the truth about their earnings,” she added.
Irene Bashabe, the assistant commissioner domestic services, URA asked tenants to always demand for receipts from their landlords to help government determine the real income that the landlord is getting from them.
“When you pay rent, you are already paying tax. It’s unfair that the landlord who is even overcharging you is not paying his equal share. When taxes are paid, every one benefits through service delivery. It is everyone’s responsibility to make sure that taxes are paid,” Bashabe said
However there complaints have been raised from the public about the rental tax which they say is similar to property tax that is being paid to KCCA.
They claim this is unfair because they are “paying twice for the same property.”
URA officials however promised to make adjustments in the two taxes to make it one.