President Yoweri Museveni has ruled out the removal of taxes on imported commodities to help Ugandans manage the increasing commodity prices saying that it would be suicidal to the economy.
Uganda’s President Yoweri Museveni has ruled out the removal of import taxes to help Ugandans cope with the rising price of commodities, saying that it would be a suicide move for the economy.
Museveni made the remarks in a State of the Nation address on Sunday. He said the issue of skyrocketing prices is not something new and can be easily managed with existing knowledge once applied rightly.
Museveni however, ruled out tax cuts saying that this would affect the economy deeply. He warned if not handled well, the price hikes can lead to the collapse of any economy.
He said because the issue is only temporary, the government cannot be diverted into creating further economic loopholes over one small economic challenge.
“For the internally produced items, I was tempted to remove taxes, but this would cripple our development. Some of these challenges are temporary. Subsidies and removing taxes from imported products is suicide,” Museveni said.
He suggested the right thing do would be for the population to switch to utilising other alternatives and also develop the capacity to manage the situation at hand.
“The correct action is ‘kukekeleza’ or ‘kubyesonyiwa’, getting alternatives for the non-oil items. Let’s develop capacity. We shall cover all these gaps by not stopping. If we stop ‘kumagamaga’, we shall be creating problems for ourselves,” Museveni suggested.
“Even when we get our own petroleum, we can’t sell it below the world prices plus transport. If you do, you create an incentive for smuggling. All these things need planning and strategy, not emotions.”
In addition, he implored the population to use imported commodities frugally and look out for alternative products. Museveni suggested that for items like soap, alternatives including sunflower can be used for production. For bread he said banana and cassava flour can be used in the meantime.
“Millet is the only cereal with protein, carbohydrates and iron. We have most of the things we need; surplus electricity and good infrastructure, and we are beginning to pay our scientists well. With our scientists, we are making everything apart from aeroplanes,” Museveni implored.
“With imported commodities, this is a recipe for disaster. It will lead to the collapse of the economy. This problem of the high fuel prices is sucking money from the pockets of individuals and sucking more dollars from our national reserve,” he added.