We don't owe Ugandan authorities a penny, says Gulf Energy

A Gulf Energy petrol station. [PHOTO: FILE/STANDARD]

Kenya’s fourth largest oil marketer Gulf Energy now says  it does not owe Uganda Revenue Authority (URA) a penny in tax arrears as alleged on its portal.

Reacting to news published in The Standard yesterday, the firm's Chief Executive Paul Limo said Gulf Energy had written to URA through its auditors giving clarifications on the “erroneous public notice”.

“They just took an estimate of VAT (value added tax) for various companies and just published a number. We do not know the basis of that number and secondly, we don’t owe URA that figure because we never did any vatable business,” Mr Limo told The Standard on phone.

He said immediately the company saw the notice; it contacted URA through Deloitte - the company’s auditors.

Thursday, Mr Limo said the claim by the Ugandan taxman is fictitious.

Deloitte had written to URA on January 4 complaining about the same. In April last year, the Ugandan Government granted VAT exemption only to companies involved in the production of oil and minerals.

According to URA, Gulf Energy owes it Sh180 million (USh6.3 billion) in VAT and income tax, a position the CEO disputes.

“The claim was 6.3 billion in Uganda shillings of which 5.8 billion is a VAT projection while about 400 million Uganda shillings is an old issue on corporate tax which it responded to way back,” said Mr Limo.

Seven-day ultimatum

The company said it had also cleared with URA on queries around the alleged pending corporate tax and the authority never indicated that the issue was still open.

In Kenya, the firm says it is among the top 10 tax payers to Kenya Revenue Authority owing to its large operations and would not want to evade taxes in Uganda where the operations are small.

“We do business across East Africa and we never try to structure businesses to reduce taxes,” he said.

Latest data from Petroleum institute of East Africa shows that Gulf Energy commands 7.4 per cent of overall market share in Kenya.

This makes it fourth after Total (14.4 per cent), KenolKobil (14.1 per cent) and Vivo Enegy (13.7 per cent).

In a list of 100 defaulters that featured both individuals and corporates, the authority had given defaulters seven days to clear the arrears or face closure.

The list had showed that majority of firms defaulted on its VAT, withholding tax and income tax.

In total, URA is seeking to collect Sh1.12 billion (38.8 billion Ugandan shillings) from defaulters.