Operations of Moyo Town Council have ground to a halt after their account with Stanbic Bank was frozen at the request of Uganda Revenue Authority (URA).
The revenue body is demanding 87.2 billion shillings from the town council in accumulated taxable arrears dating back to 1998.
According to the Assistant Commissioner in charge of Domestic Tax, Fred Ssekawaya, Moyo Town Council failed to submit the two percent tax demanded from all urban authorities, despite several reminders. Subsequently, Ssekawaya wrote to Stanbic Bak Moyo requesting the bank to freeze the town council's account till the 87.2 million shillings is paid.
The Moyo Town Clerk, Job Tabu, blames URA for not explaining to them which incomes are taxable. He says the town council receives money from several sources and that issues of taxation needed to have been specified.
Tabu says the town council's activities have literally come to a standstill as they have no money at all in their coffers.
It is not yet clear when the problem will cease as URA insists the tax has to be paid before the freeze on the account can be lifted.