URA wins again in Heritage tax row
The Uganda Revenue Authority has also won the second round in its high profile dispute with Heritage Oil over a $ 434.9 million capital gains tax assessment.
In the latest win, the Tax Appeals Tribunal (TAT) upheld URA’s assessment, ruling that Heritage’s sale of its oil assets in Uganda was a taxable transaction within Uganda.
The ruling follows a case filed by Heritage in December last year in which it challenged the assessment of $434.9million on the capital gains it earned in the transfer of its interests to Tullow Uganda Limited.
Heritage had challenged the tax assessment on the grounds that the proceeds earned from that transaction of $ 1.45billion were not taxable in Uganda because the transaction was completed outside the country.
In the earlier case, Heritage had requested the TAT not to proceed with the proceedings because an arbitration process was already underway in London but TAT declined to do so. The oil firm sought redress at the High Court in Kampala but it lost the case there also. TAT ruled that it had jurisdiction over the case.
URA said in a statement last week that this was a “landmark victory,” which had set a positive precedent.
“Being the first of such transactions in Uganda, we have now set the standard that this and such future transactions are taxable in Uganda,” the stament said.
Subscribe to this comment's feed
