The main focus of the Private Sector for FY 2014/2015:
- Reducing the high cost of doing business to enhance Private Sector Competitiveness.
- Stimulate and cause increase in disposable income to help improve local demand so as to stimulate the creation of wealth.
- Monitoring and ensure that services are delivered in time and value with money. More importantly a well-coordinated system within Government itself, which can take advantage of supportive partners and resources of the private sector to spur growth.
(Private Sector, 2014)
Private Sector concerns:
They see issues with Infrastructure development, transport, Energy, ICT. The concerns about improving business regulatory climate, also the increasing access to affordable business finance to the agribusiness. Find a new focus for National Growth strategy on export of niche products. Get a new tax regime that is predictable and encourages growth for both production and development processes. A good management model of public resources to follow planned actions and implementation (Private Sector, 2014).
Proposals according with the new Tax measures:
Income Tax: Initial Allowance on capital expenditure on eligible plant and machinery has been removed. With the termination of exemption on the interests income that is on agricultural loans (Private Sector, 2014).
Value Added Tax (VAT):
The tax is now set on exemptions on certain levels of products. Like feeds for poultry and livestock. It’s also exemption for machinery for agricultural and dairy machinery. There is also lesser tax for packaging materials to both diary and milling industries. Then there is also special tax on specialized vehicles, plant, machinery, services and civil works that is on infrastructure construction, water, education and health (Private Sector, 2014).
They wish a termination of the Zero VAT rate supply:
The products that are not under ordinary VAT is Cereals (grown, milled or produced in Uganda), Processed Milk and Milk products, supply of machinery and tools for agriculture, seeds, fertilizer, pesticides and hoes. This is also for printing services for education materials. They are set VAT of 0 % but the Private Sector wish it to be 18 % (Private Sector, 2014).
After thought to the concerns from the Private Sector on the FY 2014/2015:
To cook this all down, it’s basic Chicago-School of economics. It’s the liberalistic dreamland where everything is free and liberal. That’s where the government stops all subsidies of education and agriculture. It’s the place where the government is a little player on the market – the strong beat the little guy in every instance. It’s fearful that the Private Sector wish to get VAT on Fertilizer, Seeds, Processed Milk and Machinery to the agriculture, pesticides and hoes. This will lead to issues for the struggling farmers of the hinterland and far far away from the streets of the rich Kampala. So therefore when the issues from the Private sector is just to earn simple money and earn on the poor farmer in the districts who can’t pick or choose his tools, fertilizer and seeds. They also mark the difference in between Kenya and Uganda. Even though there similarities between the nations. Still Agricultural business is different. The export from Kenya is in another league. The export of Kenyan coffee is famous compared to the Ugandan beans. The same with the Tea, I say that and I still wished to Garden Tea.
So for me the suggestions from the Private Sector are too silent and will kill the agriculture driven business. The Tourism tax is wise, because that will be used for promotion and marketing. They have good ideas even if they fear for the exemption for the lodging outside of Kampala. When it comes to Education is the removable of exemption of income tax from private schools. Government believes that the exemption will help investments in schools in the greater Kampala areas and also the improvement of education upcountry. This means that the private sector wants to blow this off. It tells that the private sector cares more for profit then the education system. This is also making the state or governments smaller, which usually are the tools of the Chicago-School of economics.
The Government of Uganda should not follow this advice. It will weaken the state and marginalize the structure of it. The ideas from the Public Sector won’t benefit either the public or the state. Both parties might earn a coin of silver dollar in the beginning, but in the long run the crippling of the education and agricultural business will not drive it. The reason why I still publish the document and pieces of it is to show the Public Sector who must be driven the USAID and their powerful basket of money. Views of state and business: Where nothing is to collide between the state and public sector. The dreams of freedom and big business with no power to big government, except a strong police and military. The rest, that can the public can pay for or handle themselves on their own. That’s why they want taxation and VAT on all this items and cut the whole idea of Zero VAT exemptions. That’s totally against their belief system. It’s true I been beating on the government for their lack of payment of their civil servants and teachers. Still, it’s necessary to tax and get sufficient cover for the supposed running of the state and the civil service. Not only monies to the mighty UPDF and UPF. Also not forgetting NSFF.