Allied Beverages Limited v Uganda Revenue Authority

The situation

A marketing agent ran radio, television, billboard and school campaigns in Uganda for soft-drink brands between December 2020 and August 2022, some through local agencies and in Ugandan languages. It billed a foreign affiliate of the brand owner and treated the services as exports, zero-rated for VAT, relying on a 2022 contract addendum stating they were used and consumed outside Uganda.

Where it got stuck

The Revenue Authority said the services were supplied and consumed in Uganda, to raise sales of drinks bottled and sold in Uganda, and charged VAT at the standard 18%.

How it was resolved

The Tribunal looked at economic substance rather than the contract: the campaigns were performed in Uganda and aimed at Ugandan consumers, so the services were not exported, whoever paid for them. As reported, it treated the addendum as a misrepresentation and upheld the assessment.

The same agent had won an earlier round: for 2016 to 2020, the High Court in September 2024 overturned the Tribunal and set aside an assessment of UGX 17.4 billion on similar services (see Case 038). The two rulings cover different periods and, as reported, turned on different facts and arguments.

What a practitioner takes from it

For services, the location of the customer who pays is not the test the Tribunal applied; where the service is used and consumed is.

A contract clause written to describe the place of consumption will not change where it actually happens.

This case is known here from one trade-press report; read the ruling before relying on it, and read it alongside Case 038.

What could change

Published guidance with worked examples on when a service supplied to a non-resident counts as exported would save disputes like this one, which turn on facts both sides could have agreed at the start.