By Our Reporter
NATIONAL
President Museveni will today, 19th April, 2024 meet with the leadership of traders at State House Entebbe.
A press statement released by the Presidential Press Unit earlier today 19th April, 2024 says President Museveni will be meeting leaders representing the business community and specifically traders’ leaders.
The same statement says President Museveni will later on a date yet to be communicated, meet the general traders at Kololo Independence Ceremonial Grounds.
Traders especially in Kampala City have been going on a sit-down strike where they locked their shops protesting among other things the introduction of the compulsory EFRIS system, unfair competition by foreign investors, low VAT Threshold (Shs150,000) and high VAT rate which is currently standing at 18%.
On Tuesday, 16th April, 2024, the Ministry of Finance, Planning and Economic Development held an emergency meeting with the Kampala City traders who went on a Lock Shops demonstration.
The emergency meeting took place on the same day, Tuesday where the traders explained their grievances to the Ministry of Finance, URA and the Ministry of Trade.
According to Matia Kasaija, the Minister of Finance on 16th April, 2024, traders said that the current VAT threshold and rates are too high and requested government to increase the threshold from Shs150M to Shs1Billion. They also asked government to reduce the VAT rate from 18% to 16%.
The parties also discussed EFRIS (Electronic Fiscal Receipting and Invoicing System) with the traders saying the new system presents several challenges including high cost of compliance and that it applies to all traders irrespective of whether they are VAT registered or not.
Another sticky issue was that URA gives different values to different traders over the same imported goods arguing that there is need for uniformity and certainty of import taxes.
The bitter traders also accused some foreign manufacturers of hawking their products to the last consumer causing Anti-Competition practices. They say some of these foreign investors are engaging in distribution, wholesale, retail and hawking of their products resulting in undercutting prices and lower sales for the traders.
The traders were also not happy that because of high import taxes, Uganda has lost its position as the number one trading hub in the East African region which has affected their businesses.
In response, the Ministry of Finance promised to consult on the increase of the VAT threshold and lowering of the VAT rate in two week’s time.
Government however, maintained its position in implementing EFRIS but advised URA to establish EFRIS Support offices to train traders on its use, exercise more sensitivity in its implementation, and accordingly exercise restraint in issuing penalties on its non-compliance.
Regarding the Anti-competition practices by some manufacturers, the Ministry of Trade said they are finalizing the Regulations to implement the Competition Law that was recently assented to by the President.
The Ministry of Trade has also issued Circulars to KCCA, City Clerks and Town Clerks to stop with immediate effect issuing hawking certificates to non-citizens.
It was agreed that Traders resume normal business as government consults within the two weeks period.
