Income Tax Act (Cap 338)s. 130(2) and Sch. 4, Part X, para. 3FY2019/20Income Tax (Amendment) Act 2019 (Act 13 of 2019)

Case file ITA-2019-ASSET6

Withholding of 6% on the purchase of a business or business asset

Highest rung reached: Reported yieldLaw: read in a statutory textWithholding · Compliance

1 point pending verification

Confirmation that Act 13 of 2019 made the change.

Back to the register

Law

Principal Act: Income Tax Act (Cap 338), enacted as Act 11 of 1997
Amending Act: Income Tax (Amendment) Act 2019 (Act 13 of 2019) (probable: the only amending Act in force from the right date, not confirmed)
Provision, revised numbering (2023 revision): s. 130(2) and Sch. 4, Part X, para. 3
Provision, numbering before the revision: not stated in any source read
Principal Act dates: commencement 1997-07-01
Amending Act in force from: 2019-07-01
Tax heads and taxpayers affected: Income tax, Withholding tax. Resident buyers and sellers of businesses and business assets.
Status: Legal: in force. Implementation: implemented.

The wording in force

s. 130(2) and Sch. 4, Part X, para. 3
as at 2024-12-23

(2) A resident person who purchases a business or business asset shall withhold tax at a rate specified in Part X of Schedule 4 to this Act. [Schedule 4, Part X] 3. The withholding tax rate for purposes of section 130(2) is 6% of the gross payment. Verified law: Wording or a date read in a statutory text, with the version and page named.[ULII-ITA-2024, PDF page 77, s. 130(2); Schedule 4, Part X (PDF page 91)]

Redline pending verification

The wording before this amendment was not read, so no redline is drawn. The amending Act, or the consolidated text as it stood the year before, would supply it.

In plain English

Interpretation: A reading of the evidence, by a named source or by this register. A resident who buys a business or a business asset withholds part of the price for URA.

Revenue

Rung 1
Observed change
Observed: A value or event as an official source records it, copied without calculation.
- Collections for the tax heads affected are drawn on the story page, from URA's annual data books. Before and after is never presented as this amendment's effect.
Rung 2
Official forecast
Official forecast: What MoFPED or URA said a measure would raise, or why it was made, before the year began.
- URA: UGX 13 bn expected in FY2019/20 (Withholding of 6% on the sale of a business or business assets).[URA-ARR-1920, printed page 54, PDF page 61, Annex 3, item B6.0]
Rung 3
Reported yield
Reported yield: What URA attributes to a measure after the year. An official attribution, not a causal estimate.
- URA reports UGX 17.31 bn for FY2019/20, 133.15 percent of the forecast (computed).[URA-ARR-1920, printed page 54, PDF page 61, Annex 3, item B6.0]
Rung 4
Static or modelled estimate
Modelled estimate: A mechanical or model calculation, with every assumption shown.
Missing. No estimate made. A static estimate needs the taxable base before the change (volumes or values by product), which the register does not hold.
Rung 5
Causal estimate
Causal estimate: An effect identified by a stated research design against a comparison group.
Missing. No study with a defensible identification strategy was found for this amendment.
Rung 6
Wider impact
Interpretation: A reading of the evidence, by a named source or by this register.
Missing. No source read for the register describes effects on prices, compliance cost, investment or equity.

What is known, what is uncertain, and what would settle it

Known: official forecast, reported yield.
Uncertain: static or modelled estimate, causal estimate, wider impact; and 1 open point below.
Would settle it: Request to MoFPED's Tax Policy Department for the revenue estimates of each tax measure in the budget speeches and the explanatory memoranda to the Finance Bills, FY2014/15 to FY2025/26. Held by Ministry of Finance, Planning and Economic Development (Tax Policy Department).

Evidence classes: § Verified law · ○ Observed · = Derived · → Official forecast · ← Reported yield · ≈ Modelled estimate · ⇒ Causal estimate · ~ Association · ¶ Interpretation · ? Hypothesis · + Proposed reform · ! Unverified. Hover or focus a mark for its definition.

Withholding of 6% on the purchase of a business or business asset

Law

The wording in force

In plain English

Reason

Revenue

What is known, what is uncertain, and what would settle it

Pathway

Consequences

What worked

What did not

Open or not evaluated

Afterlife

Sources