MPs Reject Tax Exemptions Worth Billions of Shillings

Several companies are seeking tax pardon worth Billions of Shillings but legislator’s say there is no reason why they should be pampered.

Parliament’s Finance Committee has rejected tax exemption requests from several companies, questioning the justification for such exemptions amid concerns over fairness and tax collection.

The State Minister for Finance, Henry Musasizi, presented eight companies before the committee, chaired by Amos Kankunda, seeking a total of Shs 13.391 billion in exemptions.

The MPs strongly opposed these requests, particularly targeting J2E Investments Corporation Limited, owned by Elderly MP Penina Busingye, which sought Shs2.7 billion in exemptions.

The company had been under investigation for alleged substandard work on Ministry of Defense projects and reportedly failed to remit VAT to the Uganda Revenue Authority (URA), despite including VAT in its payments.

MPs led by Kareem Masaba and Muwanga Kivumbi argued that the company collected taxes on behalf of URA and should not be exempt.

NICONTRA Construction, owned by Nicholas Byengoma and family, including Defense Ministry Permanent Secretary Rosette Byengoma, faced similar scrutiny for seeking VAT exemptions worth Shs931 million.

MPs expressed shock that the company had collected VAT from customers but failed to remit it.

Other companies seeking exemptions included Kisiizi Hospital Power Limited, Nkumba University, Busoga University, Makerere Business Institute, and a Karamoja gold dealer, Peter Lokwang.

However, MPs were firm in their stance, emphasizing the need for fairness in tax exemptions and rejecting requests from companies competing with those paying their taxes.

MPs such as Bumaali Mpindi called for uniform tax policies, criticizing the use of influence by individuals to seek special exemptions.

The committee’s decision highlights the ongoing debate over tax exemptions in Uganda, especially in the wake of the COVID-19 pandemic’s economic impact.

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