Parliament has passed a new law requiring Ugandan tenants to pay rent in local currency (Uganda Shillings).
According to the new law, Ugandans will no longer be mandated to pay rent in US Dollars as has been the case in the past. The income tax amendment bill 2017 provides that all rental agreements must be executed in Ugandan currency.
The move comes in relief of tenants in many shopping malls who were forced by their landlords, to pay rent in US dollars despite earning in Uganda Shillings. This implied that their rent bills increased whenever there was an appreciation of the Dollar. Parliament unanimously resolved that all rental agreements must be executed in Ugandan Shillings in order to protect and eliminate exploitation of Ugandan traders whose profits are pegged on fluctuations on the money market.
Members argued that the new provision will boost the Uganda Shilling which is continuously depreciating against major foreign currencies and ease the cost of doing business in the country, especially since rental fees form a major challenge to business.
Finance Committee Chairman Henry Musasizi stated the move is good for the development of the economy. Similarly, Budadiri West MP Nathan Nandala Mafabi says Ugandan traders need to be protected. T
he changes came as parliament amended the income tax act to provide for the exemption from payment of income tax for a number of companies and to empower the minister to issue estimates of rent for the purposes of assessing rental tax among others.
