Dodoma — LAWMAKERS across the political divide rallied behind the private companies that process livestock and fisheries products saying that a hostile tax regime is hampering growth while the numerous documents required for establishing factories are a disincentive.
Shadow Minister for Livestock and Fisheries Development, Sylvester Kasulumbai and a Member of Parliamentary Livestock, Fisheries and Water Committee, Dr Titus Kamani, said the government needs to waive some taxes and relax bureaucracy associated with establishment of milk, meat, fish or leather processing factories.
"Uganda has 6.8 million cattle but produces 3.2 million litres of milk of which 394,520 litres are processed each day. The largest processing factory, Sameer, produces 120,000 litres per day which is a combined output of our factories currently," said Mr Kasulumbai (Maswa East - Chadema) who requested government to waive some taxes imposed on the industry.
He said statistics show that in 2009, Tanzania had 35 milk processing factories; Kenya had 27 and Uganda possessed 16, which processed 394,000 litres, 2.9m litres and 448,200 litres respectively.
"But currently, Tanzania is processing 105,380 litres, Uganda 204,100 litres and Kenya over 2.4m litres a day," he underlined. He pleaded that urgent action should be taken to address the hurdles frustrating private investment in the industry.
Presenting the Committee's report on implementation of last year's budget and current estimates, Dr Kamani said that although value added tax on processed milk has been waived, numerous other overhead costs and taxes are imposed on factories making it difficult to compete with imported milk from Kenya and Uganda where such charges don't exist.
"In addition, right now for a milk processing plant to be established, it needs 16 different permits issued by various government agencies, a situation that frustrates private investment," argued Dr Kamani (Busega CCM).
He also argued against similar hurdles frustrating investments in the leather processing sector which has resulted in exporting of raw skins. Dr Kamani who presented the committee's report on behalf of its Chairman who is also Rungwe MP, Professor David Mwakyusa, said despite having a huge herd of cattle, the country has failed to benefit.
"The government should urgently consider reviving the leather processing technology training centre in Mwanza to increased qualified manpower for the sector which has a huge potential," he argued.
In his budget speech, Minister for Livestock Development and Fisheries, Dr David Mathayo David said the government has continued to improve investment climate to encourage processing factories for milk, leather and meat products.
The minister requested parliament to approve over 54.56bn/- budget of which 40.7bn/- is for recurrent expenditure while 13.9bn/- is for development projects.