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2017 Budget: Government Scraps Off Tax on Irrigation Equipment, Animal Feeds

Uganda’s Shs30trn budget for the Financial Year 2017/18 is set to benefit farmers than ever before.

The budget being discussed by Parliament is expected to be passed and approved soon.

If passed in its current form, it will see a number of taxes on key agricultural items including irrigation equipment and animal feeds scrapped off.

The government could be responding  the climatic changes that have seen Uganda experience long spells of drought that have plunged the country into a food crisis of sorts.

The ongoing rains even not save the situation as many farmers are already counting losses, thanks to the deadly armyworms that have destroyed several farms and unstable rains in some parts of the country.

Currently, many Ugandans across the country are starving, with prices of food items hitting through the roof.

The exemption of tax on irrigation equipment is a big statement to supplement President Yoweri Museveni’s ongoing efforts to promote irrigation and modern farming.

Apart from irrigation, taxes on animal feeds and premixes have also been scrapped off.

Appearing before the Parliamentary Budget Committee, David Bahati, the State Minister of Planning and Kenneth Mugambe, Director Budget at Ministry of  Finance said the removal of above taxes is intended to promote animal husbandry and reduce costs of agricultural inputs.

The Government also wants VAT exemption on crop extension services.

However, the scrapping off of taxes on the agriculture items will see government lose Shs10bn in tax revenue.

If you’re planning buying irrigation equipment, it is ideal to buy after July1, 2017 when the budget becomes effective for if passed in its current form, it will be a bit cheaper to buy the equipment compared to the prevailing market prices.



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