What you need to know:
- Bobi Wine said the country can prioritise funding to only critical sectors and cut expenditure on what he termed as useless ventures.
As President Museveni addressed Ugandans on the State of the Nation yesterday, the leader of the National Unity Platform (NUP) party released a pre-recorded video in which he offered interventions to control the current economic crisis.
In his address, Mr Robert Kyagulanyi, alias Bobi Wine, proposed that the government must intervene in price negotiations to have fuel prices reduced, as well as set a price ceiling on fuel during supply shocks to control inflation and influence price decisions.
He said the government can give a breakdown of the average cost for every litre of fuel and publicise the figures for Ugandans to understand what exactly is happening.
“Government can control this by setting prices on the fuel as long as they have the breakdown which reveals costs from when the fuel is purchased to when it’s consumed by the end user. They are acting as if the Petroleum Act does not give them this mandate,” Bobi Wine said.
“The problem is that the dealers experience a high profit margin which they don’t reveal because they know that they are exploiting the citizens,” Bobi Wine said.
Bobi Wine said the government ought to suspend taxes on crude vegetable oil and wheat flour to enable the ordinary Ugandans, whom he refers to as “ghetto people’’ to carry on with their small scale business.
“Let us forget this business of Mr Museveni coming to tell us to eat cassava if we can’t afford bread. Cassava flour doesn’t make chapatti, kikomando (a mixture of chapatti and beans) or rolex (an omelette rolled in chapati) now that alone goes ahead to tell you how disconnected he is from the people,” he said.
FULL SPEECH:Museveni’s State of the Nation address 2022
More than 100 Opposition MPs yesterday boycotted the President’s address to show displeasure over alleged Museveni’s continued interference with the Judiciary and due to Uganda’s economic crisis, with inflation at 6.3 percent entering June.
This is not the first time the Opposition is calling on the government to cut or scrap taxes on both imports and other locally produced commodities.
Opposition politician, Dr Kizza Besigye spent more than a fortnight attempting to demonstrate against the high commodity prices, before suggesting they can be controlled if the government concentrates on slashing taxes on fuel and other commodities.
Mr Henry Kimera, a consumer advocate, said the only way out is for the government to revise its fiscal policy and slash the taxes on fuel and reduce expenditures on other sectors which do not directly affect the economy.
“The President can make an announcement because he is the main minister of Finance and if they don’t do that, we are headed for hell as a country. But the consumers should also cut their expenditure,” he said.
Speaking about the state of the economy last week, President Museveni said those asking the government to institute subsidies are “cheap politicians with a populist agenda”.
Mr Museveni argued that removing taxes on locally produced items such as cement, sugar and coffee would not only deplete the national reserves but also inflict tax revenue loss of more than Shs500 billion.
In his address yesterday, Bobi Wine said the country can prioritise funding to only critical sectors and cut expenditure on what he termed as useless ventures that take the tax payers’ money.
“The current budget for State House can be cut to cater for the losses that may be experienced after the removal of taxes. There is so much money spent in the classified budget which needs to be done away with,” Bobi Wine said.
According to documents from Parliament, in the Financial Year 2022/2023, the total proposed allocation to the State House is Shs429.4 billion, reflecting an increment of 4.7 percent against the Financial Year 2021/2022 approved budget.
In the Financial Year 2021/22, Shs410.236b was appropriated to State House, of which the wage bill stood at Shs18.9 billion, non-wage recurrent Shs379.025b, while domestic development category stood at Shs12.3 billion.
According to the documents, of the Shs429 billion, State House plans to spend Shs83.033b to facilitate payment of pending presidential donations, Shs16.4b for poverty alleviation under the model villages, while Shs39.4b will be for renovation and retooling of the State House and state lodges.
Bobi Wine also addressed the issue of coffee deal saying it did not make much economic sense but rather was seen as a profit making venture for the dealers.
President Museveni has since asked that the coffee deal be reviewed after Mr Matia Kasaija, the minister of Finance, Planning and Economic Development, said he signed the deal without understanding the details therein.
The law...Petroleum Supply Act
Under Section 44 (3 a, b and c) of the Petroleum Supply Act, the minister may make regulations establishing a petroleum fee to enable government to maintain the National Strategic Stocks under Section 35 and the regulations shall provide— (a) for the petroleum fee to be charged on such petroleum products as shall be prescribed in the regulations; (b) for the amount of the fee to be prescribed by the minister in consultation with the minister responsible for Finance but the fee shall not be more than 0.0005 currency points per litre; and (c) for the fee to be collected monthly by the commissioner and to be paid into the Consolidated Fund.