Uganda: UPDF Seek Tax Free Goods for Soldiers

14 November 2019

The Uganda People's Defence Forces (UPDF) yesterday appealed to Parliament to lobby for them to get duty-free goods for their soldiers.

State Minister for Veteran Affairs Bright Rwamirama told the Parliamentary Committee on Defence and Internal Affairs that while veterans are supposed to get goods from army shops at tax-free offer, they have been blocked because the Force is not able to provide even for those still in service.

He said while the President directed that the Defence Forces Shop Uganda Limited gets a tax waiver, this has not materialised. Mr Rwamirama appealed to Parliament to amend the UPDF Act to provide for duty-free status for their welfare activities.

"We have stated the facts as they are. It is not our first time. Veterans with their cards are supposed to access some of these items but currently, we have blocked them. When we get money that is appropriated to army shops, much of it goes to taxes.

"When you support our idea of duty-free goods, we shall expand our army shops. We shall be able to capitalise our shops," Mr Rwamirama said.

Nyabushozi County MP Fred Mwesigye wondered why the Ministry of Finance had failed to act on their recommendation to exempt goods in the army shops across the country.

"I don't understand whether the Finance ministry is above the law. Why don't your ministers bring ministry to order in Cabinet? We support and recommended and all our recommendations are made null and void by the Ministry of Finance. The next level to appeal is Cabinet. We have done our best as Parliament. Cabinet should bring Finance to order," Mr Mwesigye said.

In his submission, Mr Rwamirama said: "The Ministry of Finance has always been reluctant to give duty-free status to their goods."

The committee chairperson, Ms Ruth Doreen Amule, said she would invite the UPDF officials again together with the Ministry of Finance to explain why they have failed to waive taxes on goods in army shops.

The army shop has been in operation since January 10, 2010, to motivate soldiers by providing quality goods and services at an affordable price.

Stations for army shops

They have branches in Bombo, Jinja, Gulu, Mubende, Mbale, Achol-pii, Makindye, Masindi and Arua. They are doing renovations in the districts of Lira, Kasese and Masaka while Fort Portal, Katabi in Wakiso, Nakasongola, Soroti and Moroto are under consideration.

Items sold in these shops include cement, iron bars, iron sheets, roofing and wire nails, chain links, barbed wires, soap, paint, water tanks and gutters.

The UPDF officials noted that there has been quarterly tax remittance of Shs3 billion and currently, a total of Shs9 billion has so far been remitted to Uganda Revenue Authority for Defence Forces Shop Uganda Limited stock.

At least 20,560 officers who have been able to build decent homes under this initiative.

Lt Gen James Mugira, the National Enterprise Corporation managing director, said while they have equipment, their company has been facing low "contract turnover challenges due to being outcompeted by other private players in the construction market even in the Ministry of Defence."

But to support the entity, army representative Felix Kulayigye said there is need to ring-fence government projects such as construction for the UPDF.

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