Gov't Agrees to Withdraw 18% VAT on Agricultural Inputs

2792 Views Kampala, Uganda

In short
In his response, Amama Mbabazi, the leader of government business in parliament said government had decided to withdrawal the 18 percent VAT imposed on Agricultural inputs.

Government has agreed to withdraw the proposed 18%Value Added Tax on Agricultural Inputs in the 2014/2015 financial year budget,the prime minister John Patrick Amama Mbabazi has revealed.

While presenting the 2014/2015 financial year budget estimates, Maria Kiwanuka, the finance minister announced the introduced of 18 percent VAT on agricultural inputs such as hoes, fertilizers,seedlings and others.

Christine Abia, the Arua District Woman MP wondered why despite repeated claims that Agriculture is the back bone of the economy it is not considered in the taxation policy.

//Cue in: "When the highest…..
Cueout:…….agriculture based"//
Wilberforce Yaguma, the Kashari County MP noted that many Ugandans cannot afford a hand hoe adding that, it is the duty of the State to ensure that people grow and produce enough food.


Latif Sebaggala, the Kawempe North MP notedthat the country needs to build a very strong agricultural sector. He said the proposed tax would discourage people from joint agriculture and therefore kill the sector.

In his response, Amama Mbabazi, the leader of government business in parliament said government had decided to withdrawal the 18 percent VAT imposed on Agricultural inputs. 

//Cuein: "our government…….
Cueout:……pesticides and hoes"//

Mbabazi told MPs that 85% of Uganda's economy depends on the informal sector, which contributes nothing in form of taxes. He argued that taxation shouldn't be looked at as a punishment since but is aimed at pulling resources together for infrastructural development and service delivery.

 

About the author

Olive Nakatudde
Olive Nakatudde is a URN journalist based in Kampala. Nakatudde has been a URN staff member since 2013.

Nakatudde started out in journalism in 2009 with Dembe FM radio in Kampala. In 2012, Nakatudde joined Voice of Africa as a political reporter. She has been a photographer since her journalism school days at Makerere University.

Nakatudde is interested in good governance and public policy, which she reports on intensively from the Uganda Parliament. She is a keen follower of cultural affairs in Buganda Kingdom and covers the kingdom's Lukiiko (parliament). Nakatudde also reports on education and health.