Government Proposes Shs16 Billion Tax Relief for Local Firms

The government is seeking parliamentary approval for substantial tax waivers, amounting to over Shs16.8 billion, intended to support three local organizations facing financial difficulties. Minister of Finance, Hon. Henry Musasizi, presented these requests to Parliament, which was presided over by Deputy Speaker Thomas Tayebwa.

Foremost among the requests is a waiver of over Shs13 billion for the Uganda Printing and Publishing Corporation (UPPC). The ministry’s submission highlights a severe revenue decline for UPPC, from Shs19 billion in 2002 to Shs8 billion, and further to Shs6 billion. This downturn is attributed to operational instability, an aging machinery that hampers productivity and competitiveness, and a significant portion of overdue receivables, largely from government entities facing payment delays.

K-Roma Limited, a local manufacturer of Bella Wine, is seeking a waiver of Shs1.8 billion. The company has experienced a sharp decrease in its cash position and continues to face negative net cash flows. The Ministry of Finance noted that K-Roma attributes these challenges to declining sales, exacerbated by the post-COVID-19 economic environment and pressure to develop land in Namanve Industrial Park.

Ankole Western University is requesting a Shs1 billion tax waiver. The institution has faced financial strain due to a religious-political crisis within the Ankole Diocese between 2013 and 2015, which led to governance issues. Additional factors include a loss of public trust, the disruptive impact of the COVID-19 pandemic on operations, reduced enrollment, and the need to restructure existing loans, pushing the university’s indebtedness to over Shs2.8 billion by the end of 2025.

The requests have prompted questions from Members of Parliament regarding the criteria for granting such waivers and ensuring transparency. Deputy Speaker Thomas Tayebwa has referred the matter to the Committee on Finance for further review.

Source: Parliament of Uganda