{UAH} Lower taxes on utilities

Lower taxes on utilities

It is a duty of a good citizen to pay tax. However, any taxpayer should have a taxable capacity with the ability to afford a similar or better standard of living even after paying taxes.

In Uganda today, there are several taxes, some of which are not even known to the public due to the low levels of tax sensitization across the country. The Uganda Revenue Authority (URA) has tended to concentrate on urban and semi-urban areas, where commercial activities take place.

The cost of doing business in Uganda is high. One of the causes is the high cost of utilities, especially electricity and water.

Currently, the government of Uganda charges Value Added Tax of 18 per cent on both water and electricity while at the same time, business entrepreneurs pay both indirect and direct taxes on all their services and goods.

Heavy taxes on utilities not only worsen life for those already in business, but also discourage beginners and young entrepreneurs. The ministry of Finance, Planning and Economic Development, through the parliament, continues to introduce several new taxes with an aim of raising funding for the national budget.

During its 30th anniversary celebrations, URA revealed that its goal is to finance the national budget by 100 per cent. I don't want to sabotage this dream, but this is likely to spell high taxes to the population since several new taxes will be imposed on various goods and services in the name of building a comprehensive tax system.

URA's dream to fully finance Uganda's budget is not tenable at the moment. There is no sign that Uganda will not rely on international funding 50 years from now. It is still possible to introduce taxes which are not detrimental to the wellbeing of the citizens. But the current rate at which new taxes are introduced in Uganda is at a reckless speed.

My appeal is for government to categorize all essential inevitable utilities and lower their taxes. Taxes on utilities should be cut by a half or even repealed to lower the cost of doing business in Uganda.

Jonah Kiberu

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"When a man is stung by a bee, he doesn't set off to destroy all beehives"

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