Fish maw exports will attract 8% levy
Parliament on Monday approved several new tax measures including an 8 percent levy on fish maw exports, 5 percent levy and 10 percent levy on processed gold and unprocessed minerals respectively.
The House also approved a proposal for landlords to file separate returns from each rental house and this will see 25 Percent of income for owners of rental premises paid as tax leaving them with 75 percent.
The approval of the taxes was during a plenary session chaired by Speaker Rebecca Kadaga. The taxes are to come into effect on 1st July 2021 when the new financial year 2021/2022 starts.
Under the Fish Amendment Bill, 2021, legislators approved the 8 percent levy on fish maw exports dropping an earlier proposal by Lwemiyaga County MP Theodore Ssekikubo to impose a 10 percent levy on every kilogram of fish maw exports.
David Bahati, the State Minister of Finance for Planning says that the tax on fish maw exports will raise more than 10 billion Shillings.
Bukomansimbi North MP Deogratius Kiyingi and Ssekikubo defended a need for a higher levy saying that the locals do not benefit from the trade but only a small group of people.
Speaker Kadaga tasked the minister to fast track the amendments in the fishing Act to eliminate the monopoly of fish exports which is reportedly held by one exporter.
This was after Buvuma County MP Robert Migadde said that local fishermen were likely to be punished heavily by high taxes because of the effects of the monopoly holder.
Besides the levy on fish maw, Parliament approved the Mining Amendment Bill, 2021 imposing a 5 percent levy and 10 percent levy on processed gold and unprocessed minerals respectively.
In it’s proposal, government had proposed a levy of US$ 200 on processed gold and a 1 percent charge of the value of unprocessed gold. However, this was rejected by Parliament”s Finance Committee saying that the levy was very small and would be hard to implement.
Jane Pachuto, the Committee Vice Chairperson in the report proposed that instead of a US$200 levy on processed gold, the government should impose a tax of 5 percent and 10 percent on unprocessed gold which was approved by the house.
Also approved by legislators is a US$0.8 levy per kilogram of leaf tobacco exported. This new tax is under the Tobacco Control Amendment Bill, 2021.
Meanwhile, MPs also approved the Income Tax Amendment Bill requiring owners of rental premises pay 25 Percent of their rental income.
In its report, Parliament’s Finance Committee had proposed 60 percent retention and 40 percent tax but a minority report by Buvuma MP Robert Migadde and Nakaseke North MP Syda Bbumba that rejected the rate carried the day.
The MPs said that the government proposal would hike renting fees.
This same government proposal had been rejected by Parliament in the past two financial years.
Parliament further under the Income Tax Amendment Bill approved a government proposal to increase rental tax on commercial buildings from 20 percent to 30 percent.
According to the Finance Committee, this proposal will remove distortions in the rental tax regime, which arise from capping the allowable deductions for a year of income of individual rental taxpayers but allows unlimited deductions for non-individual rental taxpayers.
-URN
