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Tax Rich More

Left to right: Rubanda East MP Henry Musasizi, Ms Jane Nalunga, the country director, SEATINI Uganda and executive director Elliot Orizaarwa Tumwijukye during the breakfast meeting in Kampala.

Wealthy Ugandans must pay more taxes, a group of civil society organizations (CSOs) advocating for fair and equitable taxation have said. As at 2009 for example, the top 0.5 per cent of taxpayers in United Kingdom paid 17 per cent of total income tax. In Germany, the top 0.1 per cent paid 8 per cent, and in United States of America, the top 1 per cent paid about 40 per cent of federal income taxes.

According to the Southern and Eastern Africa Trade, Information and Negotiations Institute (SEATINI-Uganda), Civil Society Budget Advocacy Group and OXFAM, there is evidence that taxing rich individuals more can lead to significant boosts in revenue.

Speaking yesterday in a meeting where the CSOs presented alternative tax proposals to the parliamentary committee on finance, SEATINI-Uganda country director Jane Nalunga said the wealthy should contribute more in terms of taxes than it is currently the case.

She said: “We need development but the question is where the money will come from. I think we must mobilise it domestically and we should begin by having the rich pay more and the poor pay less taxes.” She continued: “We must be fair and equitable and not having those who can pay more pays less.”

In his submission, committee chairperson Henry Musasizi Ariganyira, who is also the Member of Parliament for Rubanda, said currently, the process to change the tax law with view of accommodating some of the CSOs proposals is underway. He also noted that property tax is not enforced as it should be, saying most property moguls in the country are out of the tax man radar.

Mr Lawrence Bategeka, the MP for Hoima Municipality, and also the vice chairperson of the committee, on national economy said in an interview yesterday that taxing the rich is a good proposal that will be difficult to enforce unless a parameter and a data base of who is rich has been instituted. However, for the beginning he said: “Most of these rich people invest in properties so their properties should be directly taxed irrespective of how they acquired it.”

Museveni with Magafuli in Tanzania

Tanzania has yet again refused to endorse a regional trade pact with the European Union, saying the deal stood in its way to industrialization. This stand, however, threatens to split the bloc as Kenya and Rwanda that have already signed the deal see other partner states as reading from a different scrip. Last weekend, President Museveni met his counterpart John Pombe Magufuli where they talked about the possibility of ratifying the Economic Partnership Agreements (EPAs).

These are trade agreements that the European Union is negotiating with blocs in Africa, Caribbean, and Pacific (ACP) – majorly former colonies. Once signed, the EPAs would lead to up to 82 per cent opening of the East African markets to European goods tariff-free in a span of 25 years.

The EU argues this would be reciprocal as it would also take in EAC products tariff-free. The deal would also compel the partner states not to impose export taxes on key raw materials, a move seen by analysts as likely to stall the region’s quest to industrialize.

President Magufuli reportedly told Museveni that Tanzania will not sign until outstanding issues have been addressed. In statement on Sunday, Kampala said “the two leaders urged experts in their respective governments to continue studying the matter and advise the principals who are also consulting further”.

On February 2, Museveni met Magufuli in Addis Ababa at the AU summit where they agreed to meet later this month and chart the way forward. In Addis Ababa, Museveni said he was “more worried about the unity of East Africa”.

MP to Introduce Local Content Bill

Ariko

Parliament this week, granted Leave to Hon. Patrick Nsamba (Kasanda North) to introduce a Private Members' Bill for an Act titled the Local Content Bill, 2017.

The Local Content Bill, 2017 seeks to provide for the establishment of a national Local Content Committee, the maximization of value-addition and job creation through the use of local expertise; goods and services; businesses and financing in all undertakings where public funds are used; or where the undertaking is a licensable activity; the development of local content plans and the supervision, coordination, monitoring and implementation of local content.

"While delivering his first State-of-the-Nation Address to the Tenth Parliament, the President, H.E. Yoweri Kaguta used the term 'hemorrhage' while referring to the donations this country gives to different countries from where goods and services are imported goods and services. In his wisdom, the President wished and advised that this 'hemorrhage' be dealt with if this country is to attain the much cherished middle-incomes status by 2020," Nsamba said.

Nsamba said that through procurement of goods and services, our Government has over the years been donating dollars by engaging foreign companies in almost all procurements from constructing drainage channels, mere roundabouts, constructing Government buildings to major roads and power dams.