Kampala, Uganda | URN | Uganda Revenue Authority officials are struggling to establish how much gold is produced in the country and, more importantly, where the gold exported by Ugandan refineries actually comes from, exposing gaps in the country’s reporting and regulation of one of its biggest export earners.
Lawrence Muwonge, the Uganda Revenue Authority manager responsible for extractives, says the problem starts at the mining sites, where much of Uganda’s gold is produced by artisanal miners who operate outside formal systems of production and record-keeping.
He says URA cannot establish with certainty how much gold an artisanal miner produces in a day, how much is sold or who buys it.
“Even just to know what he has sold in a day or what he has produced in a day, it is next to impossible,” Muwonge said.
He said monitoring every mine continuously would require URA officials to be present day and night, something he described as practically impossible. The problem does not end when the gold leaves the mine.
According to Muwonge, Uganda’s growing number of gold refiners provide a more visible point in the supply chain because they operate from identifiable premises and their exports can be tracked. But determining where the refiners obtain their gold remains difficult.
“We can track their figures in exports. The Bank of Uganda can report them. But when it comes to a refiner telling you from whom they buy gold, it is next to impossible,” Muwonge said.
He gave an example of transactions that, in his view, do not make commercial sense.
“The refiner is one person who will tell you, I have bought gold of $10. I have sold gold of $10, which mathematically cannot work out,” he said.
Muwonge questioned how a refinery could buy and sell gold at the same value while still paying workers, electricity, rent and other operating costs.
“Giving you evidence on what they bought from who and to who they sold is definitely very, very difficult,” he said.
The difficulties described by Muwonge are reflected in Uganda’s latest Extractive Industries Transparency Initiative report, which found gaps and discrepancies in the country’s extractive-sector data.
The fifth Uganda EITI report for the financial year 2023/24 shows that 20 extractive companies were included in the reconciliation exercise. Only 13 submitted reporting templates, while seven did not.
The non-reporting companies accounted for 31.9 billion shillings, or three per cent of total extractive revenues covered by the exercise.
The quality of the corporate reporting was an even bigger concern. Only four of the 20 companies submitted signed reporting templates.
The 16 companies that did not submit signed templates accounted for 645.2 billion shillings, representing 98.5 per cent of the reconciliation scope. By contrast, URA, the Directorate of Geological Survey and Mines, and the Petroleum Authority of Uganda submitted signed reporting templates.
URA also submitted a certified government reporting template covering all government revenues included in the reconciliation exercise. Gold is at the centre of the problem because of the extraordinary scale of the trade.
The EITI report’s production and exports section compares import and export declarations by gold-related companies.
The table records substantial differences between the quantities and values reported as imported and exported by the named companies.
For example, Thaba Investments reported imports of 12,377,803 kilogrammes and exports of 12,657,815 kilogrammes, while Simba Gold Refinery reported imports of 7,619,029 kilogrammes against exports of 7,798,408 kilogrammes.
Metal Testing and Smelting reported 6,454,565 kilogrammes of imports and 6,881,358 kilogrammes of exports.
The five named companies in the EITI table reported exports exceeding imports, although the figures should be interpreted as a reporting discrepancy rather than evidence of missing gold because the table alone does not explain the underlying transactions or adjustments.
The total mining-sector table records exports valued at 11.816 trillion shillings in 2023/24, compared with imports valued at 11.477 trillion shillings.
The discrepancies become more significant when government agencies’ gold figures are compared. URA’s records for the 2023/24 financial year showed about 46,263 kilogrammes of gold exports valued at approximately US$2.98 billion, according to data reported from the tax authority.
Bank of Uganda records for the same period put gold exports at about 48,620 kilogrammes, valued at approximately US$3.09 billion. The difference is about 2,357 kilogrammes.
The EITI findings therefore raise a broader question: how consistently is Uganda measuring its gold from the point of production to the point of export? Muwonge says the weakest link is the informal mining sector.
“Artisanal mining, as I said earlier, has improved the livelihoods of so many communities, but when it comes to taxation, we have got so many problems,” he said.
The problem is compounded by the difficulty of establishing who controls some mining operations.
Muwonge said URA had encountered mines that appeared to be Ugandan-owned but where foreign nationals were operating behind the scenes.
He described one mine in western Uganda where URA found more than 50 excavators and numerous Chinese expatriates, despite the operation appearing on the surface to be a Ugandan company.
In another operation in northern Uganda, he said officials found more than 60 Chinese nationals staying at a mining camp, although the company had told them only three expatriates were employed.
The difficulty of establishing ownership is particularly important because it affects the ability of government to determine who is responsible for production, taxation and compliance.
Uganda Registration Services Bureau officials told the same extractive-sector meeting that beneficial ownership information is mandatory when companies are registered.
The information is supposed to identify the natural persons who ultimately control a company or have ultimate voting rights.
But the existence of a registration requirement does not necessarily resolve the problem at the mine.
Muwonge says some operators can be difficult to trace even after URA interventions. He described cases where people left mining operations after URA assessments and officials could not establish whether they had left Uganda or moved to neighbouring countries.
For government, the consequences extend beyond data quality. Uganda has a policy and regulatory framework restricting the export of minerals, while gold exports have also been subject to an export levy.
Muwonge says this has created an institutional contradiction where one government agency can license a mining operator while another is expected to enforce restrictions on the export of the minerals produced.
“We have a ban on export. The DGSM has licensed. You have licensed a person who has a ban. The person is producing. Do you think you will take care of that production?” he asked.
The contradiction, he said, illustrates the broader problem of government agencies operating with different responsibilities and information.
The tax authority is also questioning whether the current gold taxation regime captures the increasing value of the commodity.
Muwonge said gold currently attracts no royalty under the regime he was discussing, while the export levy is set at US$200 per kilogramme.
He described the fixed levy as a policy gap because the charge does not rise with the international price of gold.
He said the price of gold had risen from about US$45,000 to more than US$160,000 over the period he cited, while URA continued collecting the same US$200 per kilogramme export levy.
URA data previously showed that it had assessed billions of shillings in gold export taxes, but a large portion remained unpaid.
The Auditor General has also raised concerns about gold exported without the required permits and unpaid gold export levies.
These concerns make the reconciliation of production, imports, exports, and tax payments more than an accounting exercise.
They determine how much of Uganda’s mineral wealth is actually being captured as public revenue. And gold is not the only mineral where government data has raised questions.
The EITI process has identified discrepancies in mineral production and export reporting more broadly, including differences between government institutions over the reporting of other minerals.
The latest EITI report’s mining-sector export table records about 1.66 trillion shillings in exports under “Other” minerals outside the major companies listed in the table. This suggests that the challenge extends beyond Uganda’s rapidly expanding gold trade.
The country has multiple institutions involved in the mineral value chain: the Directorate of Geological Survey and Mines licenses and monitors mining activities; URA collects taxes; Bank of Uganda records foreign-exchange transactions; and other government agencies hold company, trade and ownership information. But Muwonge says the information is not always shared effectively.
“In the past, the actors in managing or in administering revenue collection in the mining sector, that is the ministry and the URA, you find each of them want to shine at their own,” he said. “The URA wants to shine. The DGSM wants to shine.”
He argued that government agencies need to work together because production, licensing and taxation cannot be treated as separate activities.
The issue of data sharing was also raised by other officials at the extractive-sector meeting.
The Petroleum Authority of Uganda said collaboration between regulators, URA and the Uganda Registration Services Bureau is important for identifying entities, establishing beneficial ownership and protecting government revenue.
The authority said stronger integration of government systems and common identifiers would reduce duplication and improve compliance.
For the mining sector, however, the immediate challenge remains the ability to establish a reliable chain from the person extracting the mineral to the company exporting it.
In gold, that chain begins with thousands of largely informal artisanal miners whose production is difficult to measure.
It then moves through traders and refiners whose exports are easier to see but whose sources of gold, according to URA, can be difficult to establish.
At the end of the chain are billions of dollars in exports, with government agencies reporting different figures.
The result is a paradox at the heart of Uganda’s gold economy: the country can see enormous amounts of gold leaving its borders, but the tax authority says it cannot always establish how much was produced, who produced it, or who supplied the refiners.
The EITI reconciliation process is intended to make precisely these flows more transparent. But the latest figures show that the challenge is no longer simply whether Uganda has gold or whether it is exporting it.
The more difficult question is whether the country has a sufficiently reliable system to account for the gold being mined, the gold being refined, the gold being exported and the revenue due to the Ugandan public from that trade.
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