The Katikkiro of Buganda Kingdom, Charles Peter Mayiga,has called for a reduction in the Value Added Tax (VAT) and a grace period for remittance of Pay As You Earn (PAYE) as the Ministry of Finance Planning and Economic Development prepares to review the 2020/2021 budget recently passed by parliament.
According to the Kaikkiro ,Charles Peter Mayiga,the increment on taxes will only stress Ugandans who have already been greatly affected by the COVID-19 lockdown. “Raising taxes on fuels while the price of oil in the world is going down is going to cause an increase in prices for all most everything. That issue of raising taxes on fuel needs to be revised,” he said.
While addressing the media on Tuesday, Mayiga, said that there is need for the government to reduce on value added taxes imposed on water and electricity services in order to stimulate businesses that have been affected by the pandemic.
“During this crisis especially when we need a lot of water and electricity because most of the people are at home,if the bills are a little bit low, people will be more compliant. If taxes on the Telephones bills are reduced, people will also be more compliant since children are studying on the internet. It will enable the students and teachers to have more access to the internet,” He added.
His comments were based on 2020/2021 National Budget which is to be funded to a tune of Ugx 45.5 trillion. Among the avenues to fund the annual budget will involve increasing the tax base through increments on fuel, value added tax and grants.
During the reading of the National budget last week, the Ministry of Finance Planning and Economic Development, Matia Kasaija promised that government resolved to excuse companies from remitting “Pay as you Earn” for their employees until September 2020. But, Mayiga said, the period that was given is too short for the businesses to regain muscles to stand firm as the country continues to fight the pandemic.
“I think people need to stay with that money for a reasonable period of time so that it grows to enable them come out of the crisis created by the coronavirus pandemic but the period of three months seem to be very short,” he said .
He also used the press conference to task Ugandans to remain vigilant by observing all the precautionary measures aimed at combating the deadly Coronavirus.