Uganda government tightens control on cigarette and alcohol illicit trade

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In response to the escalating challenges of illicit trade, the government has outlined a series of enforcement measures aimed at curbing the illicit cigarette and alcohol trade.

Responding to queries raised by MPs on the finance committee, the Finance state minister (General Duties), Henry Musasizi, said several enforcement measures have been initiated to curb the problem.

Musasizi on Wednesday said some of the measures include the implementation of pre-arrival payment of taxes for high-risk goods destined to South Sudan- the E-Permit.

“This means these items shall first pay taxes in South Sudan before they are released from Mombasa and inland stations. It will give us visibility to harmonise values, hence taxes payable to avoid the goods being smuggled back in Uganda (SCT-Single Customs Territory Procedures),” Musasizi said while responding to questions raised by the Finance Committee of Parliament.

Musasizi also said the government, through Uganda Revenue Authority, is gathering intelligence on consolidation centres to break the smuggling rackets and hence seizure and forfeiture of the goods and prosecution of offenders.

“URA employs digital tax stamps, which are secure labels affixed to excisable goods such as beverages, tobacco, and cement. They feature encrypted codes that can be scanned to verify the authenticity and tax compliance of a product, allowing both the Uganda Revenue Authority (URA) and consumers to track goods throughout the supply chain,” he said.

He said Uganda Revenue Authority also destroys the goods seized, which is a deterrent measure employed as part of the enforcement of the Tobacco Control Act of 2015.

“Uganda Revenue Authority will continue to open up more offices at customs border posts, use seals, deploy officers with tested integrity at all customs border posts, deploy scanners, dismiss staff found in the scheme, and work with other customs administrations to ensure that transit goods exit the borders,” he said.

Harriet Brenda Apiny, Assistant Director of Legislative Services and parliament and Sheema Municipality MP, Dickson Kateshumbwa, during the finance committee of parliament on April 30, 2025. (PHOTO BY MARIA WAMALA)

This was after members of the Committee asked Musasizi to explain measures being put in place to stop the problem.

“What measures are being put in place to curb illicit trade in cigarettes and alcohol, especially the ones that are meant for transit and end up in the Ugandan market?” MP Amos Kankunda asked.

Chairperson of the Finance Committee in the Parliament of Uganda, Hon. Amos Kankunda, and District Woman Representative Napak, Nakut Faith Loru. (PHOTO BY MARIA WAMALA)

The Committee also noted that there were products that come through the customs but do not meet the standards or comply with the national legislation, for example, ORIS cigarettes.

Musasizi explained that the Uganda National Bureau of Standards (UNBS) will increase monitoring and ensure that substandard products are not allowed in Uganda's market.

In the case of Oris cigarettes, he said the client was given stamps for the importation of acceptable products, but contravened the requirements and goods were denied market access in the case of Oris cigarettes in the bond.

Ogwal Moses Goli, MP Dokolo North County (NRM). (PHOTO BY MARIA WAMALA)

“For substandard goods, URA continues to work with UNBS to enforce through access to the system and locking consignments for mandatory standard checks until UNBS clearance is given. Market intelligence is working with players in the industry to share information leading to interventions by URA,” he said.

Uganda Revenue Authority recently destroyed 36 tonnes of contraband cigarettes worth sh7b in taxes.

The contrabands were impounded all over the country, but mainly through the northern route, smuggled from South Sudan and Kenya into the Ugandan market.

URA Commissioner for Legal Services and Board Affairs Catherine Donovan Kyokunda. (PHOTO BY MARIA WAMALA)

According to URA, Uganda loses about sh30b due to the illicit trade of cigarettes. Smuggling is considered a lucrative business in terms of cigarettes.

The Tobacco Control Act of 2015 spells out that a person shall not import, manufacture, distribute, sell, or offer for sale a tobacco product in Uganda without the health warnings and messages that shall appear together and shall occupy no less than 65 per cent of each principal display area of the unit packet.

The MPs said smuggled cigarettes suffocate the local market because they are sold cheaply.