Exorbitant tariffs holding back business in Uganda

0

A non-profit organization in Uganda representing local businesses has asked Members of Parliament (MPs) to review electricity and water tariffs.

The Gateway Research Center has called on MPs to review electricity and water tariffs, saying it greatly affects business growth.

The organization led by executive director Susanie Nannozi Ggoobi said Uganda’s parliament and cabinet should discuss with the Electricity Regulatory Authority (ERA) the reduction of Yaka’s monthly service by 50 percent from 3 360 shillings ($0.96) to 1,680 shillings ($0.48).

The team made the proposals during its appearance before the finance committee chaired by Keefa Kiwanuka on January 11, 2022.

Geoffrey Lukyamuzi, a policy analyst with the organization, said the costs for maintenance and electricity units are very high and crippling undertakings. He also called for the Value Added Tax (VAT) on electricity to be reduced to reduce the cost of doing business.

“Uganda Parliament and Cabinet should engage with the Uganda Revenue Authority, Electricity Regulatory Authority and Ministry of Finance to lower the VAT on electricity from 18% to a maximum of 10% to reduce the cost of living,” he said.

Did you read?
Victories, failures and opportunities for African electricity regulation
Why Uganda is the next energy investment destination

He also called on MPs to urge energy distributor Umeme to increase the quantity of the first billable monthly domestic electricity units and reduce the current average electricity connection charge for domestic and commercial consumers.

Ggoobi said that if these fees were revised, there would be a reduction in illegal electricity connections, electricity theft, an increase in new connections and high revenues.

She also called for a review of water and sanitation charges, adding that monthly water charges should be lowered and when meters are not in use, Ugandans should not be charged.

MPs who received the petition said that while the concerns raised by the organization were essential, they needed to base it on evidence and not just narrative.

Kiwanuka instructed the team to provide adequate information on their concerns.

“You talk about public dissatisfaction, which is a radical statement; you can give us evidence about it. You mention a 12% tax on internet data and that it has crippled the economic and social well-being of citizens, but you have not shown the effects in statistical terms,” he said.

Did you read?
AfDB Electricity Regulatory Index: Uganda’s crème de la crème
An integrated energy model bridging the electrification gap in Uganda

Kiwanuka asked the team to go back and prepare a detailed report of their investigation into the matter.

Otuke County Deputy Paul Omara said the team needed to have real data on people’s tax burden and what should be done. Basil Bayaringaya, the MP for Kashari North, that the electricity and water proposals were vital but should also be well highlighted.

The team has committed to report back next month.

Share.

About Author

Comments are closed.