The Uganda Revenue Authority (URA) has slapped 60% and 35% taxes on at least 40 items imported into the country that ideally shouldn't because there is local capacity to either produce or add value to them.
This is due to amendments in the East African Community Common External Tariff (EAC-CET), 2018/19 budget whose implementation starts on July 1.
Dickson Kateshumbwa the Commissioner for Customs who led a team of officials from URA to brief tax payers about the 2018/19 financial year budget explained that the heavy import duties are aimed at promoting local manufacturers, including those in the East African Community.
He added that there are local manufacturers who need protection, while there is already enough local supply of many of the items imported in the country and region.
Some of the items that have attracted 60 percent import duties include; mineral water, toilet paper, toothbrushes and ballpoint pens among others, while those with 35 percent duties are; meat, Irish potatoes, sausages, chewing gum, sweets, chocolates, biscuits, tomato sauce, lubricants in liquid form, greases, soap and boxes.
Also, exercise books, trade advertising material, pictures, designs and photographs, instructional charts and diagrams, blankets, iron sheets, coils, hoop iron, flat bars, mild steel plates, doors, windows and their frames, furniture and mattresses will carry a 35 percent import duty tag.
While explaining why the high import duty rates on these specific items, Kateshumbwa said there is now local production capacity for them.
He argued that it is strange that Uganda imports Irish potatoes from as far as Latin America yet there is over production in Kigezi and Sebei, adding that this is the same for many products like meat, tomato sauce, furniture, among others.
Also in the amendments, some items’ duty rates have been granted, stayed at or reduced to zero. These include; road tractors for semi-trailers, motor vehicles for transport of goods, buses for transportation of more than 25 passengers and maternity Mama Kits.
Also at zero rates are items like; base oil, roofing tiles, poly vinyl alcohol and electronic fiscal device machines designed for use in business.
Also, items with reduced, set or stayed at 10 percent rates include motorcycle kits, soap noodles, flat rolled products of iron or non-alloy steel, material for making furniture, plain weave fabrics of polyester, cotton materials for making mattresses, and partly refined base oil.
Items at import duty rate of 25 percent are gas cylinders, motorcycle tyres, iron wires, flat rolled iron products.
Kateshumbwa revealed that there is a company that produces 600 gas cylinders daily, hence it needs protection, in addition to encouraging use of gas in order to protect the environment.
Cyprian Chillanyang, the acting Commissioner for Domestic Taxes says Ugandans should take advantage of agriculture and agro-processing because most of the products are tax exempt, like wheat.
He advised the taxpayers to understand the new tax measures in order to make better decisions on what to produce and where to produce.
The URA Commissioner-General, Doris Akol, explained that the taxpayers meeting is aimed at interpreting and understanding the benefits of the previous budgets and implication of the new budget, as well as understanding the new policy amendments for better implementation.
She appeals to taxpayers to acquaint themselves with the amendments and reach out to URA offices countrywide for any additional support they may need.
Today’s breakfast meeting, held at Hotel nAfricana Conference Centre, was held under the theme "benefit from your budget".
