By JONATHAN KAMOGA

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Uganda has lost an estimated $720 million in missed gold exports since July as exporters boycott a new tax.

In July alone, the country did not export any gold for the first time in six years, and now the government is seeking to reverse the new tax that was announced this year.

In April, the government imposed a levy of five percent on every kilogramme of refined gold and 10 percent on unprocessed gold for export. The new requirement became operational in July, forcing gold exporters to hold back stock to protest the tax.

Gold has for three years now overtaken coffee to become Uganda's leading export commodity earning an average of $180 million per month for the government in revenues.

According to sources at the Ministry of Energy and Minerals, the government has yielded to the demands of the gold exporters and a team of technocrats from the ministry, their finance counterparts and the sector players arenow looking for a solution by before year end. At the same time, President Yoweri Museveni has issued a directive to the Finance ministry to stay the collection of the new levy pending the ongoing review of the new tax requirement. The president suggested that the exporters should be in the meantime allowed to sell their gold under the old tax law as the review goes on.

Amos Lugoloobi, the State Minister for Planning in the Finance said the ministry is in advanced stages of implementing the presidential order.

“I am not exactly sure whether some companies have now started exporting gold formally, but with the presidential directive now in place, the exports will soon resume,” Lugoloobi said.

But two gold exporters told The EastAfrican that they have not resumed export of the precious metal and are waiting on the final review of the new tax laws.

“We have heard about the directive but officially, we have not been told about it or given guidelines of how to resume export given that the law is still in place. So, many of us are waiting for the outcome of the review which is currently going on so slowly,” one gold exporter said.

So far, since July, the Ministry of Finance said Uganda has lost close to $720 million from missed gold exports for a period of four months.

According to the state of the economy report released last week by the Finance ministry, Uganda registered a decline in export receipts to the rest of the world mainly due to a fall in gold exports, widening the country’s general merchandise deficit from $196m July 2021 to $248.8m the month after.

Authorities have reported an increased rate of smuggling of the mineral, especially through the porous borders with Kenya and Tanzania.

According to the increased smuggling of gold outside the country is one of the reasons the government is considering to revise the tax downwards so as to reduce the vice.

Most of the smugglers, authorities said are gold dealers who buy from artisanal miners in different parts of the country.