Cabinet Orders URA to Rescind Request for Banks to Disclose Customer Account Details

Cabinet has directed the Uganda Revenue Authority (URA) to rescind its recent request to commercial banks compelling them to disclose bank account details of all their customers.

In a Cabinet meeting chaired by President Yoweri Museveni on Monday, government concluded that the request by URA was injurious to the banking sector and the economy and thus should be withdrawn.

The Minister of ICT and National Guidance, Frank Tumwebaze told journalists on Tuesday that the decision by Cabinet was informed by guidance from the Attorney General.

“While URA has the mandate to access any person’s bank accounts  for purposes of tac audit and assessment financial, this should not be blanket and general application to all people including those who are complying well and paying their taxes,” the Minister said.

Also Read: Banks Reject URA Directive to Disclose Customers’ Account Details

“Cabinet accordingly directed the Minister of Finance to advise URA to drop its intensions of demanding for omnibus disclosure of people’s account details from banks which is likely to cause turbulence, unnecessary litigation which will affect the economy,” Tumwebaze added.

Government says that URA should in liaison with the Financial Intelligence Authority the agency mandated to monitor financial inflows, target people who are subject to tax investigations as has been the case.

Tumwebaze said that Cabinet considered that if implemented, the disclosure of everyone’s financial records and other bank account details would expose businesses to malicious actions by their competitors in addition to causing tension in the banking sector.

The order by government follows a legal action in the Constitutional Court by 30 commercial banks against URA) challenging the unconstitutional move which they argue violates the right to privacy as guaranteed by the Constitution of Uganda.

Also Read: Banks Sue URA Over Omnibus Disclosure of Customer Account Details

The banks argued that the request contravenes Article 27 (2) which states that “No person shall be subjected to interference with the privacy of that person’s home, correspondence, communication or other property” as well as Article 2 which describes the Constitution as the supreme law of Uganda “and shall have binding force on all authorities and person.