Xavier Radio Ug News 24 7
The Uganda Revenue Authority (URA) export system meltdown has taken a dramatic and alarming twist, with exporters now receiving chilling emails informing them that their transit operations have been disengaged over alleged tax liabilities from unvalidated and unreturned T1 transit documents — liabilities that exporters say were created entirely by URA system failures.
In the latest communication to affected exporters, URA warns: “Your transit operations have been disengaged on account of your tax liability for the outstanding T1s attached. By copy of this email, your insurance company is hereby informed to pay penalty to bond for the outstanding T1(s).”
This message has sent shockwaves across the export industry.
Exporters now say they have been completely deactivated from carrying out any transit operations, meaning: They cannot generate new T1s. They cannot clear existing consignments. They cannot file export entries. They cannot pay the taxes imposed, because the system will not accept any new transactions.
The sector is effectively at a standstill.
“This is catastrophic,” one exporter told our reporter. “We are being punished for a system that failed us. Our bonds never returned because URA’s system collapsed — and now the same system is accusing us of tax fraud!”
Since early September, exporters have battled a crippling malfunction in the URA transit bond return module.
Under normal conditions, once a truck exits the border, the T1 bond returns to the exporter’s account within 72 hours. But for three months, this return function has been paralysed. Bonds do not return after exit. T1s remain “pending” indefinitely. Exporters cannot initiate new exports. Insurance companies are flagged for penalties. Some trucks sit at borders for weeks.
Despite repeated reports, exporters say URA’s IT and system administrators have not fixed the issue.
In the latest twist, URA is now copying insurance companies on the notices, directing them to settle penalties for the “outstanding” T1s. This means insurers are being ordered to pay taxes for: T1 entries that were completed, Bonds that should have been returned, Trucks that successfully exited Uganda and Transactions that failed only because URA’s system refused to update.
Insurance companies are now raising alarms, fearing massive unexpected liabilities running into billions of shillings.
Exporters say they are now in a trap with no exit: They cannot clear the supposed debt — because the system deactivated their accounts.
They cannot capture new export entries — because the system is locked.
They cannot dispute the charges — because the T1s are stuck in the system. They cannot ship out goods — because no T1s can be generated.
The country’s export pipeline is now dangerously clogged.
“As it stands, we are dead in the water,” an exporter said. “We cannot even correct the problem. URA has frozen us out.”
To make matters worse, URA recently introduced virtual bonds as a temporary workaround — but these expired weeks ago. The underlying system remained broken, and no permanent fix was provided. Now, exporters say URA has taken the extreme step of penalising them for a failure created by URA itself.
“It is like URA set fire to our house and then arrested us for smoke,” one clearing agent said.
EFRIS Invoice Nightmare Continues
Meanwhile, the earlier crisis involving EFRIS invoices — where the system autogenerated wrong values, disappeared assessed invoices, and rejected credit notes — remains unresolved.
This means exporters cannot even use alternative documentation to process exports.
Trade experts warn that Uganda’s export sector is approaching total paralysis, with: Manufacturers unable to ship products, Agricultural exporters losing contracts, Transporters stuck with idle trucks, Insurance companies facing heavy penalties, Border points congested and Regional trade obligations disrupted.
Uganda’s reputation as a reliable trading partner is also at risk.
“We cannot continue to operate in silence. URA must come out and explain. Provide a clear, official communication on the crisis,” an exporter told us.
With demand rising across East Africa and holiday-season shipments underway, the timing could not be worse.
Exporters warn that if URA does not act immediately, Uganda could see: Loss of export markets, Legal disputes with foreign buyers, Contract cancellations, Massive financial losses and Layoffs in manufacturing and agriculture.
For now, exporters and insurers are stuck in a nightmare caused by systems they do not control — and penalties they cannot fight.
As the URA system continues to malfunction, the country’s exports are quietly bleeding to death.
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