Uganda advised on oil tax laws
London: Uganda might have to clearly write out its tax laws to avoid any looming battles with international companies – battles that might cost it money and time.
During a seminar in London recently, experts pointed to the tax cases Uganda has had with Heritage Oil and Tullow Oil, where they commended the government for winning the cases, but feared they could later lose cases if the laws are not clear enough.
“Tullow Oil’s capital gains tax case was an open one and the Uganda Revenue Authority did a very good job and won it. However, it is quite possible that Uganda might lose the Tullow case later if Uganda doesn’t change its tax legislation,” experts who were willing to talk but sought for anonymity said recently during a course on tax and development organized in partnership with the Institute of Development Studies (IDS), University of Sussex, London, African Tax Administration Forum (ATAF) and International Centre for Tax and Development (ICTD) said.
Tullow disputed the tax assessment on the $2.9 billion farm-down of its assets to Total and Cnooc, while Heritage did the same when it sold its assets to Tullow.