KCCA starts taxing special hire cars to increase revenue base

A special hire car parked at one of the streets in Kampala. The cabs will be subjected to taxation by KCCA. PHOTO BY ABUBAKER LUBOWA

What you need to know:

Reason. The exercise is meant to ensure security of drivers and passengers.

Kampala. Special hire cars will start paying taxes to Kampala Capital City Authority (KCCA) as the authority looks to boost its revenue base.
In a press statement, the authority said a one to four (1-4) seater will pay Shs40,000 whereas a five to eight (5-8) seater will pay Shs52, 000 monthly.
The registration started last week in Nakawa Division, and will spread to the five divisions of Kampala.

Some of the stages will be disbanded, merged or relocated after the exercise is done, according to the statement
Currently, the number of special hire cars operating in Kampala and nationally is unknown but once established, the figure will enable proper revenue collection by the city authority.
The Special Hire Operators and Drivers Association of Uganda had complained about errant drivers who commit crimes such as robberies thereby ruining the industry’s image.

“The registration exercise seeks, among other benefits, to streamline and bring order and sanity in the sector, alongside ensuring security of operators and passengers,” the statement reads in part.
Recently, KCCA executive director Jennifer Musisi revealed that the authority had increased its monthly revenue collection from Shs28b in the last four years to Shs75b in the financial year 2014/15.

Players react
BluCruise taxi services general manger Ben Amwine said the tax would not be a “big deal” if properly implemented.
“It comes with an extra cost to our business. But in a country that is developing and seeking to increase the tax base, it is not a big deal. After all, it is used to improve our services,” he said.

Mr Felix Mubaga, the managing director Kampala Taxi Services, said: “The tax will impact on the little profit we have been making since we are already paying more than three other taxes.”
He added: “But since the tax is coming as a must pay, we have no option but to face it.”

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