Parliament on Monday declined to approve the External Trade (Amendment) Bill, 2021 under which government proposed to levy US Dollars 0.4 per kilogram of exported maize brand, wheat bran, cotton cake and different by-products of the milling industry.
In his minority report accessed by Uganda Radio Network-URN on the Income Tax (Amendment) Bill, 2019, Nandala opposes the 0.5 percent tax on loss-making businesses after the seventh year.
The report was presented by the Committee Chairperson Henry Musasizi in which other items like supply of imported crayons, rulers, technical drawings sets, laboratory chemicals and others were also exempted in order to reduce their cost.
Parliament has maintained the 200 Shillings per litre tax on non-alcoholic drinks that government sought to reduce in the coming financial year 2019/2020.
The Ntenjeru North MP, Amos Lugoloobi said there is need to strengthen the tax body to do thorough audits to ascertain whether the exemptions are genuine instead of taxing losses.
The Private Sector Foundation Uganda (PSFU) together with Uganda Manufacturers Association (UMA) have opposed a renewed government proposal to tax businesses that have been making losses for seven consecutive years.
Bahati said the amendment is intended to limit revenue loss that occurs when a business that is making profit takes advantage of an assessed loss to avoid paying revenue for years.
The two groups appealed to parliament to reconsider the Excise Duty Amendment Act, 2018 with a view of removing the 200 Shillings over the Top OTT tax, and the 1 percent deduction on mobile money transactions which came into effect on July 1, 2018.
Government expects to generate Shillings 951 billion from the proposed policy measures and another Shillings 272 billion from administrative efficiency to achieve the policy target of 0.5percent in line with the National Development Plan II.
Henry Richard Kimera, a representative from Consumer Education Trust told the MPs that the proposed tax on mobile money transactions will in real effect reduce the amount of money available to cater for basic needs like education and health, which directly affects the rural-urban poor segments of the population.
Henry Saka, URAs Commissioner Domestic Taxes says the tax authority has observed a drop in the amount of money collected from excise duty on voice calls indicating that people now use data to call.
Hope Waira, UIAs Senior Investment Executive says while coffee is the leading export commodity at 27 percent, broadcasting equipment follows in second position at 5.4 percent, refined petroleum at 5.1 percent, and cement at 4.1 percent and cars at 3.5 percent.
Museveni urges Parliament to reconsider its position on the proposed new taxes because they are critical for financing of infrastructure like roads and power to make Uganda more competitive. Should the new taxes not be approved, the revenue shortfall at the end of the financial year is estimated at about 130 billion shillings.
Road users including passengers, drivers, motorcyclists and other have expressed their views and worries on the additional levy saying that it is going to have a toll on their income.
