On Tuesday, Parliament passed the Excise Duty Amendment Bill 2018 by which taxes introduced during the budgeting process for Financial Year 2018/2019 were regularized and confirmed.
A total of 164 MPs voted in favour of 0.5 percent tax instead of the initial 1 percent. The new levy will only apply on withdrawals-not deposits.
A total of 124 MPs rejected the tax. Of the 450 MPs, only 288 participated as others absconded from the sitting.
Although the outcome was in favour of retaining the taxes, there was a noticeable balance of legislative power as the opposing side garnered some fair mandate. There was some heat on the opposition side but not anything like the nerve-wracking scenes witnessed during the “age limit” vote last year. A number of NRM MPs voted against the official position, a sign of freedom of members to do as they wish without interference.
However, the fact that there is an increasing number of members defying party positions should not be taken lightly because it undermines loyalty and cohesion which are natural ingredients in democracy. There must be order and predictability.
The total grouping of opposition MPs, independents and the notorious “NRM rebels” worked up a deceptively pro-people stance.
On the day of the voting, I saw the true face of populism and was particularly surprised by those who voted against (the taxes). We expected them to declare their intention to do a u-turn since they were in attendance when the taxes (including over-the-top) were introduced and included in the budget “briefcase” for the current Financial Year. If they were not present in those sittings, then they are the perennial absentees who weigh down Parliamentary work. They saw in the taxes a window to wave at the people again.
It should be recalled that it was President Yoweri Museveni, acting on the outcry of the public who directed Parliament to review the tax on mobile money. His intervention saved the day; MPs had consented. Following the President’s directive, populist MPs “appointed” themselves the faces of the development, with one of them, Robert Kyagulanyi (Kyaddondo East) morphing into a streetwise Bobi Wine to lead staged demonstrations in Kampala. And in so doing, Museveni’s heart and mind on the matter was not acknowledged although facts are clear.
This habit of celebrating people’s plight to build personal careers is extremely wrong and Ugandans should watch out for such turncoats.
The NRM side was consistent from start to end; all they did was adjust the levy downward while maintaining the principle as had been argued during the budgeting process. Government killed two birds with one stone-maintained the revenue stream but lessened the levy for the ordinary Ugandan. A bitter truth is that every Government would wish to have a broad and exhaustive tax system that taps as many sources as possible. Only when it becomes severely untenable that negotiation is considered. The compromise is not for purposes of gaining or maintaining popularity but to accept that a certain level of tax burden would economically break the backs of the ordinary Ugandan.
It is obvious that MPs, ministers, and even President Museveni, are not exempt from the taxes. It’s a collective “burden” (call it responsibility) that we all wished could go away yet at the same time the reality is that the central coffers from which these officials are remunerated and services are afforded cannot be drained without refilling.
On the process leading up to passing the amendments, I think it should have been preceded by mass sensitization (not consultation; the time when masses will willingly back such a move is in the future) on the pros and cons. Equally, the amendments should have been pushed back to the next financial year. Coming on the dawn of a new financial year was a needless interruption. The only option that remained (to avoid unsettling fiscal work plans) was to maintain the taxes since shortfalls would have arisen in case of scrapping them.
For that matter, the losing side should plan to make their case during the budgeting cycle for Financial Year 2019/2020; although I doubt it will have any reversal impact since Ugandans will have become accustomed with the benefits. I also believe that no MP will be victimized (by voters) for their position in favour of the taxes. I don’t see why others feared to turn up for the vote. Those who voted against will have to wrestle with guilt as their conscience will convict for continuing to draw milk (salaries from the consolidated fund) yet they didn’t want to “feed the cow”.
NRM’s job is to ensure that tax money is utilized to deliver services more efficiently and to quickly bring to book anybody caught tinkering with Government resources. The target is to minimize external borrowing and run our affairs on locally-generated revenue.
The author is a Private Assistant to H.E the President in Charge of Media Management