Private sector upset over tax proposals

(L-R) Commissioner General Uganda Revenue Authority Doris Akol chats with Kacita vice chairperson Hope Katwiine after a meeting with traders in Kampala. PHOTO BY RACHEL AJWANG

Kampala. The new tax proposals are a recipe for disaster, private sector players have said.
Speaking in an interview yesterday, the vice chairperson of Kampala City Traders Association, (Kacita), Ms Hope Katwine, said the tax proposals, if implemented, will increase the price of fuel which in turn will compel the traders to increase prices of goods and services, making it expensive for consumers to afford basic goods and services.

She said: “We shall not sell because the prices will be too high to afford. There is no winner in all this.”
In another interview with the Kacita chairman, Mr Everest Kayondo, it emerged the commuter taxi operators are already upset, calling for the proposals to be withdrawn, saying they are already paying too much in taxes and incurring so much in terms of maintenance costs just to keep afloat.
Finance minister Matia Kasaija has proposed new taxes on beer, cigarettes and commuter taxis.
Taxes have also been planned on trucks for hire, fuel, chewing gum, sweets and chocolates to finance the Shs18.3 trillion Budget for the 2015/16 financial year.

The minister has also proposed to increase excise duty on soft cap cigarettes, hinge lid cigarettes, non-premium beers, and fuel.
According to the executive director of the Private Sector Foundation, Mr Gideon Badagawa, the same items have always been victim of tax increases, saying the government should think of bringing informal sector on board, considering the tiny formal sector is overwhelmed already.

The executive director of Uganda Manufacturers Association, Mr Ssebagala Kigozi, told Daily Monitor that manufacturers have a reason to worry, given that should the proposals be implemented, the already tough business environment will be made worse.
“The cost of doing business is already high, and they do not listen to our views. They have taken away even the little capacity in terms of competitiveness that we have been building.”