By News room

Government is proposing to increase tax on gun licenses from two million to five million shillings.

The Commissioner in charge of Tax at the Ministry of Finance Francis Twinamatsiko,, revealed while presenting revenue enhancement measures before the Budget Committee of Parliament.


Twinamatsiko noted that the Ministry is revising the non-tax revenue fees for fire arms aimed at raising revenue. Fire arms licenses range from between 150,000 to 200,000 and the maximum at two million shillings, but the new tax proposal would mean one would acquire a gun at five million shillings maximum.

State Minister for Planning, David Bahati, noted that the increment is not in any way in relation to the fight against crime but rather a revenue collection measure. He noted that the increase will not deter people from acquiring weapons for personal security.

Government expects to raise up to two billion shillings from this increment, if approved.

In May 2016, Government registered 274 firearms in civilian hands with the intention to curb the prevailing gun-related crime in the country that left even their own a senior police officer Andrew Felix Kaweesi gunned down on March 17th from his home at Kulambiro.

Meanwhile Government is set to loose over 145 billion shillings in the attempt to exempt several entities from paying tax in bid to enhance economic development.

The revenue enhancement measures for financial year 2017/2018, by the Ministry of Finance, Planning and Economic Development, will ensure some gains in terms of revenue but also losses.

For granting a tax holiday to Bujagali Hydro power project up to 2033, as a measure to reduce the cost of power supplied by the project to the national grid, it is estimated that 80 billion shillings will be lost.

Another 33 billion shillings will be lost for reintroducing exemption on capital investments outside a radius of 50 kilometres from Kampala, while seven billion will be lost when the ministry removes import duty on imports of pen-stock pipes for use in the hydro electricity power project. This move is aimed at incentivizing investment in the hydro-power project.

At least seven billion shillings will be lost in exempting Value Added Tax (VAT) on animal feeds and premises, while removal of VAT on crop extension services will cost the country two billion shillings. The move is aimed at lowering the cost of crop extension services. One billion shillings will be lost in exempting irrigation equipment from VAT.

Tour operators may be exempted from taxes and this will cost the country four billion shillings, while removal of VAT on solar batteries and lanterns will cost government two billion shillings.

Removal of excise duty on confectioneries to reduce smuggling and under-declaration will cost government four billion shillings.

But the government stands to gain 500 billion shillings in the tax enhancement strategy with 197 billion coming from an enhanced revenue for the standard gauge railway, 30 billion as a result of reinstating VAT on wheat grain, and 32 billion on the change of the excise duty regime for beer, wine, spirits and soft drinks among others.

Another 50 billion shillings will also be gained from reinstating the 10 percent import duty on crude palm oil.


Wednesday 19th April 2017 08:08:37 AM