UGANDA LAUNCHES MONEY LAUNDERING AND TERRROSIM FINANCING RISK ASSESSMENT ON TAX CRIMES AND PROCEEDS REPORT 2024
On Thursday, the minister of state for General duties, Ministry of Finance Planning and Economic Development (MFPED), Hon. Henry Musealize (MP) launched the Money Laundering and Terrorism Financing Risk Assessment on Tax Crimes and Proceeds Report, 2024. The report highlights the deliberate efforts in the fight against money laundering, terrorism financing and associated tax crimes in Uganda.
In his keynote address during the launch at Kampala Sheraton Hotel, the minister observed that several studies have shown that widespread tax crimes/evasion and money laundering can be costly to an economy. According to the report produced jointly by FIA and the URA, tax evasion is among the leading offences generating significant amounts of illicit proceeds.
Hon.Musasizi encouraged all agencies responsible for implementing the respective measures in the action plan of the report within the agreed timelines. "Let me remind you that tax crimes and money laundering techniques are changing as criminals employ new technology tools," said the Minister, adding that Uganda should stay up-to-date with technological developments that are leading to the emergence of new risks.
Your presence here today is of significant importance as it highlights deliberate efforts in the fight against Money Laundering, Terrorism Financing and associated Tax Crimes; in Uganda,” he stressed
Flanked by the United Nations Office on Drugs and Crime (UNODC) Uganda Head of Office, Ms Sharon Lesa Nyambe, the minister said It is important to note that tax crimes and money laundering not only harm the government and society but also puts law-abiding citizens at a disadvantage.
These crimes deter the growth of tax revenues that are used to finance essential expenditures by the government in education, security, health, and public infrastructure development. By evading taxes, individuals and corporations are depriving the Government of these necessary resources to perform the civic duty of providing services to its citizens, he emphasized.
He told multiple stakeholders including officials from URA, Bank of Uganda and ODPP that the background to this ML/TF Risk Assessment on Tax Crimes and Proceeds stems from the ML/TF National Risk Assessment (NRA), 2023 that established that tax crimes were the second highest proceeds-generating predicate offence as evidenced by crime data from FY 2016/2017 to FY 2019/2020. Due to the findings of the NRA, 2023, a sectoral ML/TF Risk Assessment needed to be conducted on Tax Crimes and Proceeds to get an in-depth understanding of the ML/TF risks and appropriate mitigation measures.
Ms. Sharon Nyambe of UNODC said the launch was a testament to the remarkable efforts being made to secure Uganda’s financial systems, and it is an important step forward in our joint commitment to combat tax crimes and reduce the risks posed by money laundering and illicit financial flows (IFFs).
She added that as crimes represent a critical challenge to Uganda’s economic stability and development aspirations. Despite significant progress in improving tax revenue collection, tax crimes such as evasion, fraud, and other illegal financial practices continue to undermine the country’s fiscal health.
The Executive Director of FIA, Mr. Samuel Were Wandera said the findings provided in this report will help us develop better policies and enforcement strategies. They will also guide our risk-based approach to supervision, ensuring that resources are allocated where they are most needed, in line with international standards.
He underscored the central role of the Financial Intelligence Authority as a strategic partner to the Uganda Revenue Authority in revenue mobilization. “As we prepare for the upcoming 10-fold program under the National Development Plan IV, which aims to significantly boost Uganda's domestic revenue over the next five years, FIA commits to continue with its central role of detecting tax crimes, tracing illicit financial flows, and providing actionable intelligence directly to support URA's efforts in combatting tax evasion and strengthen compliance across all sectors, Mr. Wandera said.
The Executive Director applauded the World Bank Group for their technical support and all the stakeholders involved in making the assessment a reality