Parliament to Waive Shs35 Billion in Tax Arrears for Tea Factories

Deputy Speaker of Parliament, Thomas Tayebwa, has announced that the government will forgive more than Shs35 billion in tax debts accumulated by tea factories. This significant tax relief is slated to be implemented upon Parliament’s resumption after its recess.

The decision stems from persistent advocacy by Members of Parliament representing tea-growing regions, particularly Greater Bushenyi, who have highlighted the severe challenges plaguing the sector. Tayebwa emphasized that this waiver aims to alleviate the financial strain on factories, many of which have been hampered by debt and operational difficulties.

“The minister directed that, when we resume Parliament, we will write off tax arrears worth more than Shs35 billion. I want to thank MPs from Greater Bushenyi who have worked hard on this issue,” Tayebwa stated during a burial in Bushenyi District.

Beyond the tax waiver, the government is also committed to streamlining other operational issues within the tea sector to improve management and efficiency. Tayebwa noted that these accumulated tax obligations have been a major impediment to some factories resuming full operations.

This intervention comes at a critical time for Uganda’s tea industry, which has faced a sharp decline in international prices due to weakened demand and global oversupply. Political instability in key importing nations has further impacted exports. Compounding these issues are rising production costs and concerns about tea quality, partly due to high fertilizer prices affecting farmers’ ability to maintain plantations.

Tayebwa also disclosed plans for a substantial Shs212 billion investment in the tea sector, aimed at ensuring its long-term sustainability. Eligibility for these funds will be contingent on factories demonstrating efficient and effective management.

In related news, the Deputy Speaker revealed the President’s allocation of land for two major industrial parks in Ruhengyere and Nakivale, Ankole sub-region, which are expected to create thousands of jobs and boost economic development. An additional industrial hub is also planned for Kyeizoba in Bushenyi District.

Source: Parliament of Uganda