Uganda’s 2014/2015 budget is a recipie for food and nutrition insecurity

Budget

Agriculture is Uganda’s global comparative advantage, it is a primary economic growth driver and it is key in ensuring food and nutrition security for Ugandans. The budget 2014/2015 plans to increase food production costs through increased taxation – agricultural inputs will be heavily taxed.

The taxes on hoes are reinstated. The costs of procuring agricultural loans is going to increase since the exemption of tax on interest income from agricultural loans has been removed. The costs for farmers’ transactions has increased since there is a planned 10 percent tax on mobile phone money withdrawals. The NRM administration has also planned to increase taxes on basic food items, salt, sugar, diary products.

Comparatively, administrations of other East African nations are subsidising or ensuring no or low taxation of agricultural inputs. Kenya has exempted taxes on importation of farm inputs for processing and preservation of seed. Tanzania has removed excise duty on money transfers. Rwanda has lowered import duty on sugar.

The Government of Uganda’s (GOU’s) decision to increase taxes on basic food items for Uganda, a country with poor nutrition indicators, is mind boggling. Increased taxes on basic food items, accompanied with increased food production costs will no doubt increase food prices and automatically the GOU’s planned salary increments for low paid civil servants are rendered meaningless.

The 2014/2015 proposed national budget for Uganda is as meaningless as is its predecessors and perhaps it is worse.

 

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15 comments

  1. Esther Namirimu · · Reply

    When I heard about taxing agricultural products , i felt like we need divine intervention.

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    1. And if others had any doubt that the current members of parliament are part of the problem, please doubt no more http://observer.ug/index.php?option=com_content&view=article&id=33128&catid=78&Itemid=116. The MPs have effectively been bought off in a cash bonaza in which they personal debts have been paid pay the sate?????????? ONLY IN UGANDA. We definately need devine intervention for those MPs who partook in the cash bonaza to effectively debate the budget. Chances are, the inhumane budget 2014/2015 will be approved as is.

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  2. Reblogged this on The humanist view and commented:

    While I agree with our MPs who have come out to effectively point out areas were Uganda’s national budget can be streamlined – cut costs of the blotted executive, guzzler vehicles and all, I think they should first remove the log in their eye. “The first order of business for our new parliament was to throw out the media, other observers, and behind closed doors allegedly increase their emoluments to more than Ush 15,000,000 per month. The Government of Uganda (GoU) has purchased two brand new Mercedes Benz vehicles at Ush 838 million as ceremonial cars for the speakers of parliament, in addition to the latest top of the range V8 Toyota Land Cruisers that the speakers use for travel to their constituencies. Comparatively, 31.1% of Uganda’s population (8.4 million persons) are poor and survive on less than Ush 72,000 per month. Millions of Ugandans take only one meal a day and millions more are unable to take the minimum dietary requirement of 3000 calories per day.” Read more http://www.africanexecutive.com/modules/magazine/articles.php?article=5898

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  3. We are not alone on this. The Women Members of Parliament are fight the proposed taxes on agriculture http://www.monitor.co.ug/Magazines/Farming/Women-MPs-want-tax-on-inputs-revoked/-/689860/2384608/-/e9j2rbz/-/index.html. Question is, shouldn’t the makers of the budget have consultanted the peoples representatives first, before coming up with a budget that is now on hold because of its objectionable provisions? Or was it the case that our MPs were consulted but they were sleeping during the consultation or was it the makers of the budget who were sleeping during the consultation (sorry reflecting in deep thought with eyes closed). Nevertheless, please support the Women MPs on the fight agaist the taxes.

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  4. Umar Senky · · Reply

    Wel döne Norah!! For once ugandans ‘ve realised dat Politics resulting into tribal, sentimental wars, a’int taking us anywhere developmental. So ours of a kind (sags) comes wiz a blog more of primary concern to our country AGRICULTURE!! Bravo Norah!! Kip it up.

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    1. Thank you Umar Senky, I am encouraged to continue

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  5. stephen wandera · · Reply

    good initiative but get a better high resolution picture

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    1. Yes Stephen Wandera I will do that right away

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  6. Ojilong Patrick · · Reply

    What annoys me most is the policy makers are educated to levels that is desirable but perhaps deliberately refuse to show us the “intelligence” in them. Three things will define the future of the African Content. Natural resources and space to produce food….Agriculture for a ballooning population and Tourism. It’s only in Africa that we have some countries growing between 7-8% of GDP irrespective of our conflicts. Increasingly Africa will have to feed the western industries and people as well. Tea, Coffee, Fish. I laugh wen i see tea made in England but grown in Kabale on shelves. However, Natural resources like minerals have a symmetrical relationship with wars and poverty, Tourism often benefits more the government that those living within BUT Agriculture is in the category of Messiah because of it’s potential to pull many from poverty. Its the only true trans-formative sector if you are to intervene and support majority People. Its illogical to impose a tax on a production enhancing input. Standard practice is you reap after sowing. Good analysis Norah Owaraga. We should be investing more than trying to kill york before harching

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    1. Yes, that annoys me too. Most policy makers were raised and educated through Agriculture and then they turn around and make debilitating policies against agriculture?

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    2. Another reason why Uganda’s budget should be adjusted to be more supportive of small holder farmers. I couldn’t agree more with FAO “With the right agricultural and social policies family farming can make a real difference to end poverty and hunger. #iyff14 Join us in celebrating the International Year of Family Farming, help us feed the world and care for the earth! http://bit.ly/1s1ZsYH

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  7. opio moses · · Reply

    Ugandan govt needs to revise its budget and pay attention to the most pressing needs and its economy at large ,since uganda entirely depends on produce. why not consider reducing tx on imported agricultural inputs or probably subsidize on most of the agricultural produce other than imposing heavy tax ,which would otherwise discourage the growers. Miss Owaraga, I think your opinion is so much adored and I believe this is what the govt of uganda should do , just like its neighbours.

    We can only realise our economy rise ,if we consider addressing the issue of revising tx levies on produce and other factors that directly pose a threat to our economy.

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    1. Norah, Thanks for the post.
      I can not agree with you more, when our academia has let down their ancestral Heritage of social companionship to developmental issues to a more Selfcentred, gated community approach. This approach has it’s strings attached to colonial mastery and dominion. The budget in question is not intended to enable grassroot development and empowerment, other than boosting the coffers of the Treasury and the Executive office.

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      1. Charles Matege, it would certainly seem that way …

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    2. Yes Opio Moses, a revision is absolutely necessary – so if you have access to your MP lobby them hard. The budget is not yet approved by Parliament, I think. Make sure you let your MP know that if they do not listen to our voices, we will make them pay come 2016.

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