Ugandan President Yoweri Museveni has rejected calls for tax cuts amid escalating commodity prices, saying the move would affect the provision of services to the public.
Museveni in a live broadcast late Sunday said subsidies or tax cuts for imports would deplete the country’s reserves to pay for imports. He said Uganda has 4.5 billion U.S. dollars as reserves, this is enough to support imports for 4.2 months.
Museveni said the government would suffer a tax loss of 1.53 trillion Ugandan shillings (about 418 million U.S. dollars) for gas, 1.15 trillion shillings for diesel, and 520 billion shillings for wheat.
“How, then, do we fund our budget for — roads, electricity, schools, medicine, security? Therefore, removing taxes or subsidizing many of the imports is suicidal and a blunder,” the president said.
He said the possible solution is to frugally use the imported items or get alternatives, and to use local raw materials — such as sunflower oil and castor oil for soap as the country waits for the expanded palm oil production.
“We can use our banana and cassava flour for bread-making apart from eating the traditional foods,” Museveni said.
He said the increasing prices in the country are a result of global factors including the ongoing Ukraine war and recovery from the COVID-19 pandemic. Enditem