Three govt agencies on the spot over hurting business growth

Wednesday June 24 2020

Business. Open shops at Kikuubo market in down,

Business. Open shops at Kikuubo market in down, Kampala. Most SMEs have failed to grow due to taxation challenges among others. PHOTO | ALEX ESAGALA 

By ISMAIL MUSA LADU

Despite some achievements registered over the years by Uganda Revenue Authority (URA), Uganda National Bureau of Standards (UNBS) and the Uganda Registration Services Bureau (URSB), these three government agencies need to do more in facilitating the growth of Micro, Small and Medium Enterprises (MSME).
Speaking at the e-post budget dialogue conference yesterday, the chairperson of the Governing Board of Uganda Agribusiness Alliance and the former Minister of Agriculture, Prof. Victoria Sekitoleko, named the tax prefect, the standards body and the business registration bureau as “top killers of MSMEs”.

She said: “We would like to see URA, UNBS and URSB help businesses to formalise and grow. But before you know it, you see somebody who is just starting out is being closed down by UNBS or being assessed by URA and then told to pay so much or closed down.”

She continues: “Such businesses should be given tax holidays and helped to comply with standards before being asked to pay taxes or shutdown over standard issues.”

According to the Professor whose Uganda Agribusiness Business Alliance is all about uniting those involved in the industry to optimise their ability to profitably pursue the global opportunities that present themselves as part of competing in the world’s largest industry, government should be part of the value chain.

She further disclosed that apart from milk processing equipment, all other agricultural machineries are subjected to various taxation on the grounds that they serve more than one purpose.

Finance Minister Matia Kasaija, in his address, took note of the issues Prof Sekitoleko raised, saying the government is open to suggestions and implement what it can and give feedback where it is unable to fulfil its promises.

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He, however, stressed that any criticism should be followed with a possible solution because that provides the government with options.

Shs200billion more for arrears
It further emerged in the post budget e-conference, the first of its kind, that government has mobilised about Shs200 billion more in addition to Shs490 billion allocated in the 2020/21 budget to settle part of the Shs3.3 trillion arrears owed by domestic suppliers of goods and services to the government.

According to the director budget at the Ministry of Finance, Mr Kenneth Mugambe, settling MSMEs debts is on top of government’s agenda as they go about enhancing the population’s aggregate demand as well as household purchasing power.

In her submission, the chairperson of Uganda Manufactures Association, Ms Barbara Mulwana said the government should settle the arrears it owes local suppliers and manufactures before the close of the first quarter of the coming financial year, just days away.

Mr Julius Mukunda, the executive director of CSBAG, described this as “extra ordinary times” saying they require “extra ordinary measures,” including having the government print money to fulfil its obligation, a suggestion Dr Adam Mugume, director of Research at the Central Bank disagress with, saying it is uncalled for.

ROOM FOR DIALOGUE
Measures
Finance Minister Matia Kasaija, in his address took note of the issues Prof Sekitoleko raised, saying the government is open to suggestions and implement what it can and give feedback where it is unable to fulfil its promises.

He, however, stressed that any criticism should be followed with a possible solution because that provides the government with options.

iladu@ug.nationmedia.com

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