Civil society organisations have renewed a national campaign to support President Museveni’s original stand against the proposal of exempting Members of Parliament from paying taxes on their allowances.
Addressing journalists at their offices in Bukoto yesterday, Mr Julius Mukunda, the coordinator civil society budget advocacy group, said taxation is the price citizens pay for service delivery and development but the proposals by MPs to exempt themselves from paying taxes is detrimental to the national budget which raises 68 per cent of its resources from domestic taxes.
“All citizens including medical workers, teachers and private citizens pay taxes on their allowances including lunch allowances for medical workers and sitting allowances for district councillors,” he said.
He explained that with the current size of Parliament, if the Bill becomes law, the country stands to lose Shs49 billion yet this is money could be distributed to pay science teachers, start the national health insurance scheme, hire health workers and revitalise cooperatives.
“It sets a wrong precedent for other civil servants whose allowances are taxed. The private sector and other Ugandans will try all means possible not to pay tax,” he said.
In February last year, the commercial court ordered MPs to pay taxes on their allowances and emoluments dating to 2004 following a petition by concerned citizen Francis Byamugisha who questioned the rationale of MPs not paying tax. The MPs run to court appealing the ruling which is yet to be heard.
As the term of office for the 9th Parliament came to an end last year, President Museveni sent back the Bill to the speaker of Parliament Rebecca Kadaga warning the house that MPs have no ‘moral right’ to exempt any of their emoluments from taxes and doing so, “would send a dangerous message” to the rest of the country.
Even as the CSOs get up in arms, last week the legislators unanimously passed the Bill which is supposed to be endorsed by the President arguing that they are already paying hefty taxes on their salaries and allowances.