Commissioner General Allen Kagina, why didn’t you take Michael Ezra’s Money as under Section 107 of the Uganda Income Tax Act, Cap 340?
Flamboyant businessman Michael Ezra Mulyoowa showed off US$ 3million (7 billion Uganda Shillings) in cash at the Emin Pasha Hotel in Kampala On Thursday 2 September 2010, making it to the front pages of both the Uganda New Vision And Monitor newspapers on Friday 3 September 2010, with pictures of him grinning over the cash and clearly having a good time.
This was after the Commissioner General of the Uganda Revenue Authority (URA), Allen Kagina wrote to the Immigration department saying that Michael Ezra should not be permitted to leave the country until he settles his tax liability.
“The Commissioner General of the Uganda Revenue Authority (URA) Allen Kagina has asked the Ministry of Internal Affairs to bar city tycoon, Michael Ezra Mulyoowa, from travel abroad. In a letter of August 23, addressed to the commissioner of the immigration department, Kagina said Mulyoowa should not be permitted to travel out of the country before he pays over sh 1.1b he owes to the Government in taxes.
Kagina stated in her letter that under the powers conferred upon her, she would certify that Mulyoowa owes URA a total of sh 130,753,296 in taxes” wrote Hillary Nsambu on the front page of the New Vision newspaper dated Monday August 30 2010.
Then out came the money!
“City tycoon Michael Ezra has denied being on the run over debts, displaying wads of dollars ($3m) to prove his point.Addressing a press conference at classy Emin Pasha Hotel in Nakasero yesterday, Ezra, 37, said he owes the Uganda revenue Authority (URA) about sh 1b in unpaid taxes and the National bank of Commerce sh 400m.
He added that he and his partners were in the process of paying up ‘at a convenient time’.He declined to name his partners or how the amounts accumulated, but added that the issue had been around since November 2008.
“The commissioner General of URA is not wrong to say I owe them money because promises to pay have not been fulfilled. As negotiations continue, I have engaged several lawyers and auditors,” he said.Ezra, who had been said to be on the run, also said he needed to consult whether he would pay the taxes as an individual or share them with other concerned parties.
“I am trying to be as evasive as possible, but what came out (in the media) was at the wrong time,” he said, writes Cyprian Musoke on page 2 of the New Vision newspaper dated 3 September 2010.
Dear Commissioner General, why didn’t you use section 107 of the Income Tax Act Cap, 340 to collect the sh1, 130,753,296 Michael Ezra owes the State?
Michael Ezra, held a press conference at which he said he owes you (the URA) money. Then he proceeded to put your money on a coffee table to be photographed. All you needed was an order in writing specifying the person against whose property the proceedings are authorized, the location of the property, and the tax liability to which the proceedings relate and maybe take a police officer along to be present while distress is being executed.
You (the URA) has recently been forging ties with the Judiciary. For example Faridah Nkalubo, on 1 September 2010, writes in her article in the Daily Monitor titled ‘URA, judiciary partner to promote tax compliance’ that the URA has partnered with the judiciary to increase engagement in tax compliance in order to raise more government revenue. Surely some members of the judiciary would have been willing to assist had you preferred to proceed under summary procedure.
You would have gone down in history as the first female Ugandan Commissioner General to collect sh1.1 billion, in cash, in under 30 minutes.
So, what happened?
Didn’t anyone alert you as to what was happening at the Emin Pasha Hotel?
TO: Michael Ezra Mulyoowa
Some options for you on tax avoidance (not evasion).
You could move to Monaco, where the uber rich go, to avoid paying individual income tax. You would not have to file individual income tax returns. However, a 1 bedroom apartment (flat) goes for at least US$1 million so the question is, are you that rich? And there are other issues to consider, like whether you would like to be a citizen of Monaco. This is because you will need a 10 year residence permit to apply for citizenship.
Moving closer to home is the island of Mauritius. In Mauritius, you would pay tax at a reduced individual tax rate of 15% as opposed to the current 30% you’re struggling with.
It is easier to get permanent resident status in Mauritius. You could invest US$ 500,000 and apply for permanent residence. But it is just as easy to lose resident status as it is to get it. For example, if your investment fell below the US$ 500,000, you would lose your resident status. Or if you were convicted of a criminal offence carrying a term of not less than 12 months, you would still lose your status. (You might want to sort out the issue of the bounced cheques)
Moving further out into the South Pacific is the Republic of Nauru. It’s the world’s tiniest island nation covering 21 Sq kilometers. There are no taxes except airport tax.