Bahati in during meeting

The National Development Plan (NDP III) priorities remain Agriculture, Tourism, Minerals, Petroleum and Manufacturing in addition to Human capital development and Infrastructure.

A total of 20 national strategies and 18 national programs have been articulated under each of the five NDP 3 objectives for the achievement of the overall goal.

NDP III is introducing Program approach to focus on delivery of common results, aligned with Program Based Budgeting that is already operational.

There will also be an increased role of the State for purposes of investing strategically more so in infrastructure and human capital development.

More focus will also be on digitalization for efficient delivery of services as well as introduction of the Parish model to bring Government services and support nearer to the people.

According to NPA Chairperson Prof. Pamela Mbabazi some of the challenges that NDP III is expected to fix include: The inadequate creation of jobs, dependence on rain fed agriculture and inadequate investment in the productive sectors of the economy such as agriculture and manufacturing.

The Strategic direction of NDP III was approved by Cabinet in September 2019.

Bahati said basing on the lessons learnt from NDP 1 and 2, government proposes that NDP 3 focus should be on increasing household incomes and improving the quality of life of Ugandans as the overall goal.

“Industrialization should be the vehicle for generating inclusive growth, employment and sustainable wealth creation,” said Bahati.

The post Bahati chairs ministerial consultations on draft National Development Plan 2020/21-2024/25 first appeared on Uganda Multimedia News & Information.

Kasaija however clarified the matter that the move is not to ban gaming in the country but rather foreign betting companies who repatriate their profits back home.

The minister was speaking to a number of journalists at Imperial Royale Hotel on Tuesday during the launch and dissemination of a report on compliance of national budget framework paper.

“We’re not banning gaming. We’re saying this activity should be limited to only Ugandans. We have said that licensees that are running will not be renewed and new ones will not be issued to foreigners because we’ve discovered so much of our money is being exported through that gaming thing which as far as I am concerned has little value to the economy.

“It ends up by taking our very scarce foreign exchange which we earn through very difficult circumstances like growing coffee and other crops,” he said before encouraging youth to work hard,” the minister added.

According to the State Minister for Finance in charge of Planning, Mr David Bahati, President Museveni directed a ban on betting and ordered not to renew or issue licenses. This will encourage the youth to work hard.

Source: Daily Monitor.

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“Your role is to assist the economy to grow. This is our survival and you have absolutely no right to frustrate business because if it doesn’t grow, how will you collect more revenue? This is to create jobs for our children, to get out of dependency and if you are not able to help, please go and do other things,” he said.  

He, therefore, urged the staff of URA to step up their game by facilitating business in the country adding “one of your missions is to facilitate business and investment. Don’t waste time anybody`s time, these are people who are adding to the national wealth.”

The President was speaking during the official commissioning of the Uganda Revenue Authority Tower in Nakawa Division Kampala District. The 22-floor building has been constructed at a total cost of UGX139 billion.

The President who toured the complex reiterated that government is planning to put up office structures in a move that will see government cut cost on rent.

“We are going to build a government campus although we have delayed because of some corrupt people. Government has been losing Shs.96 billion per year to pay rent for Central Government offices only,” he noted.

He advised URA staff to remain patriotic if the institution is to achieve the expected results. He warned that government will not tolerate any corrupt officials now that so many young educated Ugandans are readily available to take up those positions.

He said that all the country’s borders must be scanned adding that measures must be put in place to close the gaps. He commended URA for the measures that have been put in place so far citing the electronic Monitoring Unit as an example.

Mr. Museveni revealed that Government spent more time in revamping URA by recruiting people with integrity. He was, therefore, optimistic that with integrity, patriotism, technical training and technology, URA is destined for great performance.

State Minister for Planning, Hon. David Bahati, said the President’s commissioning of the complex spelled an endorsement of the work that URA has been doing. He said the building will save Government approximately Shs.7 billion in rental fees. He added that this is in line with the policy of consolidating Government resources where it is envisaged that Government institutions should have their own office accommodation at Bwebajja along the Kampala – Entebbe highway.

URA Board Chairman, Dr. Simon Kagugube thanked President Museveni for the support and partnership in building URA house. He observed that this will go a long way in improving service delivery to the public.

Commissioner General of URA, Ms Doris Akol, lauded President Museveni and the Government of Uganda for fully committing funds to the project which, she said, will offer infrastructure for better service delivery and reduce the cost of doing business for both taxpayers and URA in one stop service centre. She pledged commitment and better services to the country.

President Museveni was among the people who were given awards for outstanding contribution to URA.

Source: State House Uganda

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Minister Bahat made this revelation on Thursday while appearing before the Local Government and Public Service committee.

This came after the minister was summoned alongside the Ministry of Local Government to explain why Government has taken long to formalize the newly created Sub-counties and Town Councils.

State Minister for Finance in charge of Planning, David Bahati while appearing before the Local Government and Public Service committee where a revelation was made of  Shs700bn  for the next general elections.

The 2021 expenditure will be higher than Shs419.9bn that was spent in the recent 2016 general elections.

“The figures we are receiving indicate around Shs700bn for the general elections and we plan to allocate some resources in 2019/2020 for the preparations and then in 2020/2021 for the general elections.

“The elections we are talking about are from level one to the President,” Bahati said.

The minister went on to explain in support of why the budget has increased more than that of the 2016 general elections saying democracy is expensive.

“The cost of democracy isn’t cheap. Democracy isn’t cheap if you don’t want democracy, try the other. The other is more expensive with war and violence,” Bahati said.

The minister informed the Committee that Government’s resources envelop isn’t well prepared and there will be another plan developed in consultation with Ministry of Local Government to operating on the remaining Sub-counties and Town Councils.

The Parliament passed a motion in 2017-2018, that led to the creation of 198 sub-counties and 204 Town Councils which required Shs151bn.

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State Minister of Finance for Planning, Hon David Bahati: COURTESY PHOTO

The State Minister of Finance for Planning, Hon David Bahati, has declared that Uganda’s public debt is at Shs41 trillion, which is an equivalent of US$10 billion.

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Socila media graphic -Internet Photo

According to the Uganda minister of information and communication technology, Frank Tumwebaze, the mobile money tax is to be reduced from 1 to 0.5 percent charged on only withdrawals but the 200 shillings daily tax levied on social media users per day will not be tampered with.

However, the mobile money tax will not apply to utility transfers like paying water, electricity and school fees and the Over The Top (OTT) tax will be charged on social platforms like Whatsapp, Facebook, and Twitter but not on emails and google searches.

Several demonstrations were staged by the public and various activists across Uganda especially in the Kampala capital to show dissatisfaction towards the tax.

On July 7, 2018, Robert Kyagulanyi aka Bobiwine launched a campaign dubbed “This tax must go” and he called upon all Ugandans to stand together in the bid to scrap off the tax. Unfortunately, the arrests that ensued maybe fruitless due to the cabinent’s decision.

David Bahati, Minister of State for Finance, Planning and Economic Development put forth that government’s target is to collect an annual amount of about 32 million U.S. dollars from the 10 million social media users in Uganda.

“We want to get more options so that you can pay the social media tax quarterly or annually instead of the daily, weekly and monthly subscriptions,” Bahati said (The Observer, July 17, 2018).

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Some of the companies involved in the mobile money business in Uganda. Internet Photo

This follows an outcry and anger from the citizens who,  rather than make mobile money transactions as was before the taxes, prefer to use public means such as motorcycles, taxis to transfer money as they found it cheaper to travel than incur the extra costs that come with the tax. For social media, users have either abandoned the service or decided to bypass the blockage by using VPN.

The 1% tax that was levied on all mobile money transactions (depositing, sending and receiving) effective from 1st July 2018 has been met with stiff resistance from the public who termed it as double taxation. Telecom companies and government have since locked themselves in endless meetings regarding the matter.

Museveni said that telephone companies have been under-declaring calls until recently when we acquired machines to see the telephone calls ourselves. File Photo

URA commissioner, Doris Akol and State Minister for Finance, David Bahati, later issued statements and said that the taxation on deposits had been scrapped off after a cabinet meeting.

Mobile Money is the most popular platform widely used in Uganda to transmit cash between individuals and pay for goods and services.

However, President Museveni further weighed in on the matter; “This is to clarify that there is no tax on mere depositing money on a mobile phone account. That confusion should be clarified. The half -percent tax, not 1 percent, is only on the sender and the receiver of money through mobile money,” read part of the post on his Twitter and Facebook accounts where he termed social media chatting as a luxury by those who are ‘enjoying themselves or those who are malicious.’

He continued, “Mobile money transfer, on the other hand, is a useful service. Since the informal sector (juakali, mchomo selling etc) is never taxed and I am always against those direct taxes on those sectors, is it too much for users of the mobile money senders and receivers to also make a modest contribution to the development of their country? The 1% was a miscommunication. The actual figure was 0.5%, half of one percent. That is what we should debate, on the mobile money”

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Read full statement below:

Dear Ugandans, 

Greetings.

I am using social media to share with you the reasons for the social-media tax and the mobile money tax. Our budget for this financial year is Ug.Sh 32 trillion. 

The taxes collected from within Uganda and the other fees for this financial year will be Ug.sh.17.5 trillion. The balance (the difference) is handled by borrowing from outside the country, Ug.Sh 8.3 trillion, as well as borrowing from within the country, Sh 7 trillion. We, then, also get grants from outside to the tune of Sh280bn i.e 0.28 trillions.

Why do we have to borrow or beg from outside or even borrow from within? We do so because many people who are supposed to pay tax do not pay the tax. How do we know this? We know this by using the standard measurement used all over the World. This is the GDP: tax ratio. This means the amount of taxes paid compared to the size of the GDP, the size of the economy. 

In 1991 , it was only 4% of GDP. When we formed the URA, it rose to 12% and it has stagnated there for a long time. Last financial year it rose to 14.2%. In other countries in Europe, the GDP: tax ratio is 30% or more. The avarage GDP: tax ratio in Africa is 18% . Why is the GDP: tax ratio in Uganda so low? The following are the reasons: 

(a) telephone companies have been under-declaring calls until recently when we acquired machines to see the telephone calls ourselves. Big shame to the culprits; 

(b) Many of the people who should be paying taxes of incomes from rent do not pay or underpay;

(c) Many citizens are still in subsistence agriculture (okukolera olubuto kyokka, Itiyo pi ikeni ) and informal sector (juakali) and I always oppose taxes on those sectors (gonja roasters, mchomo sellers, mechanics, carpenters etc); in any case, it is difficult to know how much they earn;

(d) Absence of scanners on the borders allows false declarations of goods in containers; the URA now has 4 scanners only. I have directed them to buy enough scanners to cover all entry points by land, water and air; and 

(e) Slowness in introducing electronic stamps to the goods imported from outside at the factory level. 

We, therefore, end up getting revenue from consumer taxes on mainly, luxuries, income tax, profit tax and import tax on consumables minus the production inputs only. That is why we end up with the low GDP: tax ratio of only 14.2% and have to borrow or beg, yet our economy is growing. 

Coming specifically to the social media and mobile money taxes, Ugandans need to ask the following questions: 

1. When you post or send communication on social media platforms like Facebook or whatever, is it for free or do you pay? 

2. Do you send mobile money for free or do you pay? 

3. If you pay, whom do you pay? 

4. Do you pay in dollars or in local shillings? 

5. If you pay in local shillings, do the ones you pay, most of whom are foreign companies, take money out of Uganda in local shillings or in dollars? 

6. If it is dollars, who earned those dollars? 

Let us answer the last question first. Those dollars are earned by us who produce coffee, tea, the milk products, by our gold, by our tourism, by our processed fish , by our manufactured goods (e.g cement, textiles, soap, mattresses, cooking oil, etc). 

Therefore, some of us, myself included, either earn the dollars or save the dollars by producing products instead of importing them, but some of our countrymen donate those dollars back to the foreigners by chatting endlessly on the social media. Is this correct or fair? Is it good for our country? 

Mobile money transfer is, of course, different from the social media chatting. Social media chatting is a luxury by those who are enjoying themselves or those who are malicious. 

Mobile money transfer, on the other hand, is a useful service. Since the informal sector (juakali, mchomo selling etc) is never taxed and I am always against those direct taxes on those sectors, is it too much for users of the mobile money senders and receivers to also make a modest contribution to the development of their country? The 1% was a miscommunication. The actual figure was 0.5%, half of one percent. That is what we should debate, on the mobile money. 

As to social- media tax, all the moral reasons are in favour of that tax. The social – media users have no right to squander the dollars I earn from my coffee , my milk etc by endlessly donating money to foreign telephone Companies through chatting or even lying and, then, they are allergic to even a modest contribution to their country whose collective wealth they are misusing. 

The same with those who engage in games betting. They bet in Local shillings. Since, however, our economy is an open one, the foreign owners of betting machines rush to the forex bureaus, buy dollars, the ones I earned , so as to externalize them. This is what affects our shilling.

The importers of foreign luxury goods- wines, whiskies, artificial hair, furniture, textiles, shoes etc, goods that can be made here, also squander our dollars. Fortunately, on account of our campaigns, the import bill has decreased from US$ 7 billion to US$ 5 billion. That is not enough, however. 

There are no taxes on agricultural products, no taxes on machinery for factories or agricultural machinery , no taxes on raw- materials , no taxes on scholastic materials, no taxes on medicine, no tax on exports, no graduated tax etc. Most of the inputs in wealth and job creation are not taxed because we want people to engage in production. The essentials are never taxed. 

This is to clarify that there is no tax on mere depositing money on a mobile phone account. That confusion should be clarified. The half -percent tax, not 1 percent, is only on the sender and the receiver of money through mobile money. Discuss this. 

I congratulate our Science team for demonstrating that we now have the eyes to see all the goings on in the telecommunication and financial services. No more games. This capacity will be extended to deal with the criminal pigs that have made it a hobby to kill Ugandans. They will pay. I am , however, interested in a rational and honest dialogue, especially on the half -percent tax on mobile money sending and receiving. 

Signed 

Yoweri Kaguta Museveni.

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State Minister for Finance David Bahati is among the many MPs crying foul

Several Members of Parliament have made a cry to Police and Uganda Communication Commission to intervene in the ongoing scams that are highly targeting them and other high profile people by con-men.

This comes at a time when cases of fraud are apparently being reported by almost every MP about thugs that hack into their phones and Face book accounts and con their friends’ money.

The latest is one involving Kasiro County MP, Elijah Okupa, who narrated to parliament how his number was hacked by thugs who asked money from a number of MPs claiming that Okupa was stuck in Eldorate.

Gulu Municipality MP, Lyndro Komaketch, reported that he is currently paying back 17 million shillings to friends who were conned in the same manner using his name.

Okupa asked the Uganda Communication Commission and telecommunication companies to devise means of stopping this practice.

The state minister for planning in the ministry of Finance, David Bahati is among the many MPs crying foul over this cybercrime as his  Facebook account was hacked into hence used to con the public.

The minister of Internal Affairs, Obiga Kania,  assured  the MPs that measures were being taken by both police and UCC to clear the loop holes that are still leading to such cyber-crimes.

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It also requires licensed persons in the business of casinos, lotteries and gaming  to furnish weekly and monthly returns in order to manage risk as payouts are done on a daily basis.

It further states that taxes owed by government to Uganda Revenue Authority will be waved as at 30th June 20l8 except withholding tax. Government makes commitments to pay taxes on behalf of some taxpayers in strategic sectors through agreements, memorandum of understanding or commitment letters.

However, Members of parliament were furious over the report that some small business entities are charged unfairly compared to investors who are given tax holidays at the expense of small business holders.

The chairperson of the Finance Committee, Henry Musasizi, told parliament that the Uganda Revenue Authority is supposed to carry out an assessment on the returns and confirm the tax to be paid within a year but it has been a practice of URA not to conduct an assessment within a year, which has affected tax payers as URA conducts the assessment after several years of filing returns but imposes interest on the tax payer from the time of filling returns.

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However, Members of parliament were furious over the report that some small business entities are charged unfairly compared to investors who are given tax holidays at the expense of small business holders.

Bahati argued  that all Value Added Tax  payers should acquire tax machines and cash registers. Government should not pay taxes on behalf of persons who have not earned incomes.

The chairperson of the finance committee Henry Musasizi said that all matters concerning tax returns be filed every financial year but not all business entities most especially small businesses should be charged unfairly.

MPS Merdad Ssegoona Patrick Nsamba,Wilfred Niwagaba  Amos Lugolobi .Col .Fred Mwesigye and James kakooza demand that a company that has made a profit should pay it’s taxes. Any agreements that government has made to exempt companies making profits from paying taxes should be declared nullified.

They said that there should be proper criteria of handling tax exemption which are mostly benefited by foreigners.

Kabula county Mp James  kakoza James said that profit making companies that  owe the state a tax ,must be pay . He added that the excuse that charging them a tax will chase investors is a lie and must be rejected.

The minister of state for planning David Bahati argued that all Value Added Tax payers should acquire tax machines and cash registers. Government should not pay taxes on behalf of persons who have not earned incomes.

The Ministry of finance has been exempting entities from paying taxes without Parliament approval.

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David Bahati – Internet Photos

Government has apologized for the delay in releasing the approved funds for treatment and management of nodding disease.

The minister of State for Planning, David Bahati made the apology after the MP for Tochi County, Peter Okot, raising the matter on the floor of parliament.

Bahati said that the Ministry of Finance is to sign a warrant releasing this money which was authorized by parliament through a supplementary budget.

On 14th March this year, parliament approved 1.2 billion shillings to support eight districts and two regional referral hospitals for treatment and management of nodding disease but the money has not been released.

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