Questions

(1') (9) (h) procedure for determining customs value. (6 marks) factors which affect duty paid to customs. (2 marks) value of goods imported by Kapere. detailing costs that are included and those excluded with supporting reasons. (5 marks) tax payable by Kapere to customs assuming shoes pay import duty of 25% and the exchange rate for the month was 1 USD = Shs 3699.02. (10 marks) (Total 50 marks) SECTION B Attempt two of the three questions in this section Question 2 (a) (d) In Uganda. traders use a single administrative document (SAD) to declare their goods to customs. Required: (i) Identify the main features of a SAD. (5 marks) (ii) Describe the main accompanying documents attached to the SAD and their importance. (5 marks) Revenue administration world over use risk management to deal with the ever-increasing volume of trade while maintaining a limited number of staff. Required: Explain the meaning of the term risk management. (2 marks) Uganda Free Zones Authority was established by The Free Zones Act 2014. However, the concept of free zones has remained a mystery to many people. You have been invited to make a presentation at an ICPAU seminar. Required: Prepare a presentation including the following: (i) The meaning of the term tree zones. (2 marks) Question 1 During the recently concluded taxation awareness seminar, members under the umbrella organisation, Kanoni Traders (KT) were informed that, the Commissioner Customs, had made administrative announcements under section 2 (2) (a) and (b) of the East African Community Customs Management Act 2004 (EACCMA 2004) and section 64 (k) of the East African Community Customs Management Regulations 2010(EACCMR2010) in a bid to streamline tax collection and administration while facilitating trade in the country. They were further informed that in first pronouncement, the Commissioner requires the traders to pay taxes within 72 hours of assessment. Secondly, the commissioner directed that some items should not to be warehoused but instead traders should pay for them at the first point of entry. that is to say. Mombasa or DaresSalaam. This announcement raised a lot of anxiety and questions from a number of KT members. They convened an emergency meeting during which they decided to write to the Commissioner pointing out their areas of concern and requesting for a meeting with customs administration. KT members pointed out that the administrative announcement was not going to facilitate trade but instead frustrate the traders in a number of ways, including but not limited to: (a) it was going to strain them on the cash flow amidst increasing duties paid on these goods. (b) Pie-export was going to be extremely difficult calling for the tedious process of refund. (c) Under the single customs territory it would become difficult to clear non- paying goods, temporary imports and consignments paid for by government, which take time. (d) By the time goods reach the port of Mombasa and DaresSalaam, the documents would not yet available to the shippers hence making it difficult to determine the value. quantity. and duties paid to customs. (e) Sometimes customs gives traders arbitrary value necessitating the traders to go through a lengthy process of appealing which would lead to skyrocketing of demurrage costs. (ii) The benefits of free zones. (3 marks) (iii) Payment of customs duties, in regard to goods manufactured in a free zone and sold internally and externally (4 marks) (e) Discuss the benefits of the bonds in international trade. (4 marks) (Total 25 marks) Question 3 In the Kyoto convention. customs administration came up with the term 'trade facilitation'. This term has turned out to be a catchword in the modern customs administration. However. the newly elected chairperson of Kampala Metropolitan Traders heard about it on his election day. He has sought your services to help him understand this term. Required: (a) Describe the contents of the reversed Kyoto convention. (6 marks) (b) Discuss the advantages and disadvantages of trade facilitation. (7 marks) (c) Describe the steps taken to license an internal container depot. (6 marks) (d) Explain the procedures for licensing a bonded warehouse. (6 marks) (Total 25 marks) Question 4 (a) Restricted goods are goods which are only exported or imported after fulfilling a number of conditions. Required: Using an example, describe the procedure of clearing restricted goods in Uganda. (9 marks) (b) Discuss the steps taken by customs to dispose of prohibited and restricted goods, which end up in Uganda. (8 marks) (c) Describe the steps taken by modern customs administrations in controlling smuggling and other international irregularities along the common borders. (8 marks) (25 marks) During the emergency meeting. Kapere. informed members that he had imported a container of shoes for which he had paid: (a) USD 40.000 to the supplier. (b) USD 2,000 for transportation and handling of container from factory to the port of loading. (c) USD 4.000 to the shipper. (d) USD 1.000 to a Ugandan company contracted to look for the shoes model. (e) USD 5.000 paid in advance to a logistics firm to handle and transport the container from Mombasa to Kampala. All the above payments are in addition to USD 10.000 spent on research and development of a model in the Republic of Greenland. This model was sent to the supplier to base on to manufacture the shoes for this order. Kapere is particularly interested in knowing the customs value of his goods and the taxes payable to customs before leaving Mombasa. In the same meeting Musa. a reknown trader also wondered the difference between guaranteed and non- guaranteed goods. The leadership of KT has approached you as a certified tax advisor to advise them on their position and redress before the due date for the scheduled meeting with the customs administration. Required: Advise the leadership of KT on the: (a) provisions of: (i) Section 2 (2) (a) and (b) the EACCMA 2004. (2 marks) (ii) Section 64 (k) of the EACGMR 2010. (2 marks) (b) benefit of warehousing pointing out how this administrative enhancement is likely to affect the traders. (7 marks) (c) procedures for clearing: (i) temporary imports. (4 marks) (ii) re- exports. (4 marks) (d) difference between guaranteed and non-guaranteed goods. (2 marks) (e) trade documents used in the international trade. (6 marks)