Ministry of Finance appears before the Parliamentary Committee on Finance
Today 24th 04 2019, officials from the Ministry of Finance led by Hon. David Bahati, the State Minister for Finance in charge of Planning, appeared before the parliamentary Committee of Finance chaired by Hon. Henry Musasizi, to present a proposal for the government to write off tax arrears amounting to UGX 426 billion out of the UGX 2.6 trillion tax arrears that have so far been documented by Uganda Revenue Authority (URA) and also to present the tax amendment bills for financial year 2019/2020.
The Minister informed the Committee that the arrears arose out of Governments’ commitment to pay taxes (customs duties and domestic taxes) on behalf of entities deemed to be of strategic importance to the country and on behalf of Non-Governmental Organisations (NGOs) which had contractual obligations with Government. He noted that considering that were no funds for payment of the tax arrears that had been budgeted, the government is at crossroads hence a need to write them off under the Tax Procedures Code (Amendment) Bill, 2019. In his concluding remarks, the minister told the committee that there was an urgent need for government to write off all its unpaid taxes totaling 426 billion shillings as at 30th June 2019.
Among the companies visa vie the amount of money that government has failed to meet in tax holidays include UGX 20.4 billion Steel and Tube Industries Ltd, UGX 57.5 billion for Cipla Quality Chemical Industries Ltd that manufactures Antiretroviral therapy drugs, UGX 41 billion for Oil Palm Uganda Limited, UGX 134.7 billion for Oil Palm Uganda Limited, UGX 86.8 billion for Southern Range Nyanza Ltd, UGX 2.5 billion for Fine Spinners Uganda Ltd, UGX 279.1 million for Bugisu Cooperatives Union among others.
The Committee however, questioned the motive behind writing off the mentioned tax arrears for the government, yet other Ugandans were paying taxes. In fact the Committee’s view was that the government had the obligation to lead by example by paying all its taxes. In response to the concern raised by the Committee, the minister observed that, the decision to request parliament to allow government to write off the debt, follows the request which had earlier been presented before the parliament for supplementary budget to pay off the arrears but this was rejected by parliament as well as a request to waive off the money.