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(MONITOR UGANDA) Stanbic Bank boss survives arrest over defying Kagina

Stanbic Bank boss survives arrest over defying Kagina
By Monitor Reporter
Posted Thursday, January 14 2010 at 00:00

Stanbic Bank’s managing director yesterday narrowly survived arrest over failure to remit Shs2.5 billion to the Uganda Revenue Authority from the account of the power company Jacobsen Power Plant.

Mr Philip Odera was due to record a statement at the police but URA sources yesterday said the bank moved fast and remitted the money to the tax body.
The seven days that the tax body had given the bank to remit the money, owed by the power company in tax arrears since 2008, expired on January 12 and Ms Allen Kagina, the URA boss, had wanted Mr Odera to be held personally liable in accordance with the laws.

“In the circumstances of the bank’s failure to comply with the requirements of the agency notice, prosecution proceedings under the offence provisions of the VAT Act must be commenced,” Ms Kagina wrote in a letter to Mr Odera, which Daily Monitor has seen.

Mr Daniel Nsibambi, the bank’s director of communications, declined to comment, citing confidentiality rules. URA was bitter that an agency notice and a Commercial Court order to Stanbic instructing the bank to remit Shs17.6 billion from Jacobsen’s account were ignored.

Agency notice

An agency notice is a document URA sends to the bankers of a company with tax liabilities; instructing it to remit the money on the account to the tax body until the tax obligations are cleared in full.

The Norwegian power company operates a thermal power plant at Namanve near Kampala. The tax row between URA and the power company has been going on since June 2008 when the tax body tabled a Shs14b tax bill in VAT.

Though it initially claimed that it was tax exempt, the Norwegian company finally bulged and accepted to pay Shs14 billion but not the interest of Shs2.5b, which has accumulated since June 2008.

The power company subsequently took the matter to the Commercial Court, which ruled in URA’s favour, forcing Jacobsen to pay Shs14.37 billion.

The tax body issued an agency notice to recover the Shs2.5b interest, which the bank did not comply with. URA wanted the bank’s chief to be held personally liable for the “non-compliance.” He could have faced several months in jail on conviction.

Labels: STANBIC, TAXATION, UGANDA, UGANDA REVENUE AUTHORITY

posted by MrK @ 5:29 PM