Latest news with #Musasizi
Zawya
27-03-2025
- Business
- Zawya
Government seeks tax exemptions to Bujagali, local start ups
Government has proposed yet another tax exemption to Bujagali hydro power project that will see the power producer relieved of the burden up to 30 June 2032. The proposal is contained in the Income Tax (Amendment) Bill, 2025 that was tabled for its first reading by the Minister of State, Finance, Planning and Economic Development (General Duties), Hon. Henry Musasizi. The Bill was tabled during plenary sitting, chaired by Deputy Speaker, Thomas Tayebwa on Thursday, 27 March 2025. Last month, the same Minister tabled the same Bill, seeking to extend the tax exemption to the power company up to 30 June this year. Subsequently, Musasizi appeared before the Committee on Finance, wherein the lawmakers raised concerns about the management of preferential shares by Bujagali Energy Limited, arguing that the redemption of these shares had led to financial losses for Uganda. Between 2018 and 2021, government granted the power company similar tax exemptions. However, in 2023, Parliament rejected the request by government to award Bujagali another five-year tax exemption. Meanwhile, the proposed amendments to the Income Tax Bill, 2025 also include exemption of startup businesses established by a citizen for a period of three years from tax. This exemption, the Minister justified, is aimed at encouraging entrepreneurship, support small and medium enterprises and stimulate innovation. Relatedly, Government has proposed exempting textile inputs from Value Added Tax (VAT). This proposal is contained in the Value Added Tax (Amendment) Bill 2025 that was also tabled for its first reading during the same sitting. The Bill, tabled by Minister, Musasizi, outlines the textile inputs for exemption as wet processing operations and garmenting, cotton lint, artificial fibres for blending, polyester staple fibre and viscose. Others include, textile dyes and chemicals, garment accessories, textile machinery spare parts, industrial consumables for textile production and textile manufacturing machinery and equipment. The proposed amendments in the Bill will further see solar lanterns exempted from VAT and such products include, deep cycle batteries, solar lanterns and raw materials for the manufacture of deep cycle batteries and solar lanterns. 'The repeal of the VAT exemption on billets is intended to boost local production, reduce reliance on imports, and advance Uganda's industrialisation agenda,' said Musasizi. He added, 'By supporting domestic manufacturing, this measure is expected to create jobs, enhance value addition, and stimulate economic growth.' Bio-mas pellets have also been lined up for VAT exemption, with the justification that this will promote environmental sustainability by encouraging the adoption of cleaner, energy-efficient cooking and heating solutions, reducing reliance on traditional biomass fuels. Further to that, aircraft supply is expected to be zero-rated, once the proposed amendment is adopted. The proposed amendments also introduce the anti-fragmentation rule, a move the Minister said is aimed at combating tax evasion by preventing importers from intentionally splitting consignments to remain below the VAT registration threshold. 'This measure is expected to enhance tax administration, improve revenue collection, and strengthen Uganda's VAT compliance framework,' said Musasizi. Under the proposed amendments, United Nations-related agencies and specialised agencies will be designated as listed institutions. Distributed by APO Group on behalf of Parliament of the Republic of Uganda.
Zawya
12-03-2025
- Business
- Zawya
Uganda: House approves extra Shs4 trillion for 2024/2025 Budget
Parliament has approved a supplementary request of over Shs4 trillion that will provide outstanding certificates for road construction companies, security and completion of infrastructure for the hosting of the African Cup of Nations (AFCON) 2027. The request came under the auspices of the Supplementary Expenditure Schedule No.3 for financial year 2024/2025 where Shs1.1 trillion was spent under the three per cent provided for under the Public Finance Management Act (PFMA), 2015 whereas Shs3.1 trillion needed prior approval of Parliament. The Minister for Finance, Planning and Economic Development (General Duties), Hon. Henry Musasizi, said this is in line with Section 24 of the PFMA. The Act provides that where the total supplementary expenditure that requires additional resources over and above what is approved by Parliament, it shall not exceed three per cent of the total approved budget for that financial year, without approval of Parliament. 'We sought and obtained approval from Cabinet to present to this House, the supplementary expenditure amounting to Shs3.1 trillion which is above the three per cent legal limit. It requires prior parliamentary authorisation before the funds are utilised by the respective votes,' said Musasizi. In a report of the Budget Committee on the supplementary request presented by Hon. Dicksons Kateshumbwa, over Shs257 billion is earmarked for completion of Hoima Stadium, commencement of construction of Akii Bua Stadium and upgrade of facilities approved for hosting AFCON. The rollout of at least 20 million doses of anti-tick vaccines requires additional funding of Shs60 billion under the National Agricultural Research Organisation (NARO), that is also seeking an additional Shs10 billion to produce and distribute aflatoxin mitigation products. 'The supplementary will enable NARO to roll out the anti-tick vaccine by June 2025 after which the facility will be self-sustainable. The aflatoxin mitigation products are meant to uplift the standard of Ugandan products on the international market,' said Kateshumbwa. To finance the buyout of Umeme, government requires over Shs725 billion. An additional Shs60 billion is needed to fund Inspire Africa, for completion of standards and certifications, working capital to purchase coffee from farmers, branding and marketing of coffee as well as operational funds to run the factory. According to the minister, the supplementary budget will be financed through the Petroleum Fund, local revenue, non-tax revenue, domestic and external borrowing. A minority report presented by Kira Municipality MP, Hon. Ibrahim Ssemujju expressed reservations on additional funding of shs298 billion under debt servicing towards Lubowa Hospital. Ssemujju Nganda alluded to a report of the Auditor General which observed that government failed to conduct adequate due diligence on the agreements and the overall project, which he said raised doubts on the validity of the payments relative to the work completed. 'There is significant risk of financial loss for Ugandans if additional funding is allocated to the project. It is recommended that the project be halted until a special audit report is completed and Parliament can deliberate on the findings,' Ssemujju Nganda said. He also queried funding worth Shs115 billion paid to re-operationalise Atiak Sugar factory, Shs67 billion for a coffee value addition park in Ntungamo District and the funds required for the Umeme buyout. 'Your duty as colleagues is to subject every single request to the law. Is it unforeseen, is it unavoidable, and is it an emergency? That is the duty you have on behalf of the country,' Ssemujju Nganda added. Hon. Denis Oguzu Lee (FDC, Maracha County) expressed concern over the supplementary request for the Umeme buyout saying a loan request for the same, is still under consideration. 'Umeme has been recovering their costs through feed-in tariffs where they add their costs. Now they are demanding for money from Ugandans when their concession is about to expire, yet this matter has not been resolved to a logical conclusion,' he said. The Deputy Chairperson of the Committee on National Economy which is considering the loan request, Hon. Robert Migadde said the Ministry of Energy and Mineral Development has not presented information required for scrutinising the loan request. 'Ministry of Energy was supposed to produce a report of the Auditor General on how they arrived at the US$190 million loan request, but it has not yet come back to the committee,' said Migadde. Musasizi, said the supplementary request for the Umeme loan will be managed through borrowing from the domestic market (Stanbic Bank). The Speaker Anita Among guided that the approval of the supplementary request does not affect the loan request before the committee. Distributed by APO Group on behalf of Parliament of the Republic of Uganda.
Zawya
07-02-2025
- Business
- Zawya
Uganda: Shs1.2 trillion approved to facilitate merged agencies
Parliament has approved a supplementary budget of overShs1.2 trillion to facilitate the transfer of funds from rationalised government agencies to the receiving institutions. The supplementary expenditure schedule No.2 for the financial year 2024/2025 was presented by the Minister of State for Finance, Planning and Economic Development (General Duties), Hon. Henry Musasizi on Thursday, 06 February 2025. According to the allocations, the Ministry of Works will take Shs934 billion under development expenditure and over Shs246billion under recurrent expenditure. 'This is required to implement the revised structure and operationalise the functions of the Uganda National Roads Authority and Uganda Road Fund,' Musasizi said. The Ministry of Agriculture will receive Shs32.7 billion for recurrent expenditure and Shs2.6 billion for development. Musasizi said that the funds will implement projects under the Dairy Development Agency, National Agricultural Advisory Services, Cotton Development Organisation and Uganda Coffee Development Agency. On the other hand, the Uganda Free Zones and Export Promotion Authority has been allocated Shs2.3 billion for development, Shs859 million under statutory to cater for contract gratuity and National Social Security Fund for staff as well as Shs8.8 billion for recurrent expenditure. The National Planning Authority, National Identification Registration Authority and Ministry of Water and Environment equally benefited from the Shs1.2 trillion supplementary. 'Supplementary Expenditure Schedule No.2 will be funded using unreleased resources that had been appropriated to the rationalised votes,' Musasizi said. The House suspended Rule 153 to allow the supplementary request to be approved without its estimates being committed to the Budget Committee. This followed a a motion moved by the Government Chief Whip, Hon. Hamson Obua. 'The Committee of this House has equally considered a motion of reallocation. In my humble opinion, there would be no need going through the due processes under Rule 153,' Obua said. A section of lawmakers however, opposed the motion. Hon. Jonathan Odur (UPC, Erute County South) said suspending Rule 153 is unconstitutional. 'Rule 153 operationalises Article 156 of the Constitution; to that extend that it reproduces the provision of Article 156. By the move to suspend this rule, the mover also purports to suspend the provision of the Constitution,' he said. Hon. Denis Oguzi Lee (FDC, Maracha County) said that the Constitution dictates the process through which budget and supplementary expenditures are approved. 'We cannot rise above what the Constitution has dictated,' he said. Deputy Speaker, Thomas Tayebwa guided that the funds in question are already available, saying that approval of the supplementary request is aimed at completing the process of rationalisation of government agencies. 'This is money we had already appropriated; the source is available. I think indecision and delay on the part of the House does not help in terms of planning,' Tayebwa said. Parliament passed several Bills, merging several government agencies following the government's policy on Rationalisation of Government Agencies and Public Expenditures (RAPEX). Distributed by APO Group on behalf of Parliament of the Republic of Uganda.
