Company gets Shs16b tax break to import rice
A rice grower at Doho rice farm . A row is brewing between Trade minister Amelia Kyambadde and rice growers over allowing a single firm to import rice from Tanzania tax-free. PHOTO/FILE
A row is brewing between Trade minister Amelia Kyambadde and rice growers over allowing a single firm to import rice from Tanzania tax-free, a move other players say disadvantages them and frustrates the growing of rice in the country.
The Rice Association of Uganda (RAU), as a result, has sent a protest note to Ms Kyambadde, questioning the logic behind the ministry’s decision to allow a single firm to import 50,000 metric tonnes of rice from Tanzania without paying taxes.
The complainants argue that if the decision of the ministry was to allow importation of rice from Tanzania, it should have been open up to whoever is willing to engage in the business.
The importation of the cheap (tax-free) rice is hurting the rice growers, they say.
The ministry issued an import permit to Ms Gotovate Uganda Limited on July 15.
The ministry also worked to ensure that the firm got a tax waiver which allowed it to bring in the rice without paying VAT and withholding tax. The import permit is valid until December.
The rice farmers say Gotovate Uganda Limited and Mansoor Mohamed Kayondo, to whom some of the documents related to the rice imports are addressed, were not known as players in the rice sector until then. By press time, we were unable to reach Mr Kayondo, to whom the documents directed to Gotovate were addressed.
“I find it odd that (the Ministry of) Trade would be soliciting from (the Ministry of) Finance an exemption for an importer. It is the trader’s job to solicit and not the minister,” Ms Rachel Mbabazi, the chairperson of RAU, told Sunday Monitor on Thursday afternoon.
Ms Mbabazi also thinks the decision is a contradiction of the “Buy Uganda Build Uganda” (BUBU) policy that the Ministry of Trade has been promoting as a means of boosting local consumption and increasing household incomes.
She has now penned a letter demanding that Ms Kyambadde explains herself.
In the letter, dated September 3, a copy of which Sunday Monitor has seen, Ms Mbabazi questions why Ms Kyambadde took the unilateral decision to allow the importation of rice on concessional terms without first consulting other stakeholders.
“If we had been asked to offer an opinion, we would have surely explained the harm in such an action. I would, therefore, like to request for enlightenment regarding the conditions under which a single company was granted a stay of application on 18 per cent VAT,” Ms Mbabazi wrote.
The Commissioner of External Trade at the ministry, Mr Emmanuel Mutahunga, declined to discuss matters around the concessional permit.
“That is a high profile matter that would require the minister herself. Please get in touch with her,” Mr Mutahunga said.
By press time, our calls to minister Kyambadde’s known mobile telephone number went unanswered. She also did not respond to text messages. It is estimated that least $4.5m (approximately Shs16.72b) in taxes, which should have been collected by the Uganda Revenue Authority (URA), has been lost as a result of the tax waivers.
Ms Mbabazi says the rice, which was imported under the arrangement and clearly labelled “Islamic Relief Rice” ,has flooded the market, displacing locally produced rice.
Mr Venugopal Pookat, the managing director of Kibimba Limited, formerly Tilda Uganda, told Sunday Monitor that locally produced rice can hardly compete with imported rice because it comes in on the cheap.
“We have tried to reduce the prices as much as possible but we still cannot compete,” Mr Venugopal said.
This has placed actors in the sector in jeopardy at a time when they are struggling for markets due to the effects of the Covid-19 pandemic.
“Because of this (flooding of tax-free rice on the market) farmers are forced to store their paddy hoping for better prices in the future. It is not only our local farmers who have been affected,” Ms Mbabazi writes.
She hastens to add that it is not only farmers that have been affected by the cheap tax free rice.
“This has also led to a reduction in business for local millers. The entire rice industry and the livelihoods of nearly three million people who depend on smallholder production is in distress because of this decision,” she adds.
Long standing war with Tanzania
Mr Phillip Idro, the chairperson of the Rice Millers Council of Uganda, told Sunday Monitor that most rice farming communities, for example those in Nwoya and Bulambuli districts, have since opted to grow other crops, especially fruits and vegetables until rice from Tanzania stops coming in.
Mr Idro said this incident is the latest in a long standing fight that local business people have been having with their counterparts in Tanzania.
In 2018 Tanzania banned Ugandan sugar on its market on grounds that Ugandan sugar producers were importing cheap sugar from Kenya and Brazil and repackaging it for export to Tanzania. It then imposed a 25 per cent excise duty on sugar that had been exported by Kakira Sugar Limited. The sugar was later returned to Uganda.
Now Mr Idro says the fight over rice came up in around 2017, when Ugandan millers sought to import paddy rice from Tanzania, but the Tanzanians insisted on selling milled rice, which the local millers rejected opting to import from Pakistan.
“We proposed to have a quota slapped on imported rice from Tanzania, but Ugandan officials abandoned us. We are now on our own yet, the Tanzanians will not negotiate with us because we are not in government,” Mr Idro said.
Speaking to Sunday Monitor by phone on Thursday, Ms Mbabazi said the only way the situation in the sector can be normalised is by levying taxes on the rice.
“All that we are saying is that the tax should be levied on the rice. If they pay VAT and withholding tax, it will bring them back on a level playing field with the rest. They should pay tax for whatever had come in earlier,” Ms Mbabazi said.
She said this was drawn to the attention of URA during a September 18 meeting, but that the tax body is yet to respond.
On Thursday afternoon the manager of public and corporate affairs at URA, Mr Ian Muhimbise Rumanyika, promised to revert, saying he was yet to get clarification on the issues, but he had by press time not done so.
Lack of Agronomists worries grape farmers in Mbarara
Grape farmers in Mbarara are concerned that they are earning less from the crop due to the absence of an agronomist to offer expertise on the processes for growing and harvesting the crop.
There are more than 200 grape farmers in Ibaare, Nyamatojo and Nyakayojo, all in the South Division of Mbarara City, where more than three hills are fully covered with the crop. They are mainly planting Muscat and Karmen, which thrive well in semi-arid areas.
But the farmers said that they are growing the crop without clear information on the ideal varieties of grapes grown in Uganda, and knowledge of soil management, site preparation, planting, pruning, pest and disease control, fertilizer application as well as harvesting.
By nature of their work, agronomists work with farmers to help them grow the best possible crops, based on their extensive knowledge of chemistry, biology, economics, earth science, ecology, and genetics. They usually conduct experiments to develop the best methods for increasing the quality and production of crops and develop methods for protecting crops from weeds, pests, and harsh climates.
Alex Asiimwe, the Chairperson of Mbarara Grape Farmers Cooperative Limited said that without a specialist in the region, many of them are left to gamble with the crop. Often, he says, they struggle to manage the spread of pests in grape plantations.
James Mugabi, a grape farmer said he once lost more than 25 tons of grapes to fungus, which he didn’t know and failed to get the best drug. He narrates that once the crop has been attacked by either a pest or disease, the entire plantation is destroyed.
Allan Namanya, a grapes farmer from Katojo said the absence of an agronomist is costing them a lot since grapes are considered the most lucrative crop at the moment. He says that a kilogram of grapes costs between 2,500 and 3,000 Shillings and a bottle of wine costs 20,000, yet it can even cost much higher than this if they are advised on the right farming practices.
Mbarara city Agricultural Officer, Vincent Mugabi, said that the department also has a shortage of personnel knowledgeable about the relatively new crop for the area. He wants the government to consider taking them for training to acquire knowledge.
Grapes are harvested twice a year, in April/May and November/December seasons. They were introduced in Mbarara at Nyamitanga hill the Catholic seat by missionaries in the 1960s.
Original Source: URA via The Independent
Farmers in Napak want security forces deployed in gardens
A section of farmers in Napak District is demanding for the deployment of security personnel in gardens to prevent attacks by suspected Karamojong warriors.
This follows a message that was sent to one of the phones belonging to the community member in Nabwal sub county threatening people to stop cultivation or else their cattle will be stolen. Suspected warriors have also been dropping leaflets in the villages warning farmers of possible attacks in case they risk going to cultivate in their gardens.
Robert Koryang, a resident of Lotome trading center, says that they are worried of going to their farm gardens which are far away from their home because of threats from the cattle raiders.
Koryang said the warriors are still hunting for cattle and they see the farming season as an opportunity to target farmers who use oxen for ploughing.
He observed that the persistent insecurity in the region frustrated their efforts to cultivate last year leading to a hunger crisis.
Judith Anyakun, another farmer recalls that early last year a suspected raider chased them out of their farms before making off with four oxen that were used for ploughing.
She suggested that the security forces should be deployed in their settlements nearer to the fields so that they are able to respond to any attack that may occur during farm activities.
John Paul Kodet, the LCV Chairperson for Napak, says that they are taking the threats seriously because the warriors have been issuing warnings to the communities before attacking.
Kodet said they have distributed seeds to the farmers but he is skeptical if communities shall be able to cultivate due to threats from suspected warriors.
He noted that some villages in the sub-counties of Lopei, Lokopo, and Lotome are very distant from the military installations and this puts them at high risk of being attacked.
Kodet appealed to the government to tighten security in the targeted areas such that people will be able to cultivate without fear.
Denis Okori, the Napak Resident District Commissioner said that the security forces already have the intelligence about the planned attacks and measures have been put in place to protect the communities.
Okori said they have designed strategic plans on how the deployment will be conducted and therefore farmers should not get worried because the government is trying everything possible to ensure there is peace.
He also confirmed receipt of the phone used for sending threats and it has been taken to the Internal Security Organization for tracking.
Okori urged the communities not to worry but instead clear the gardens for farming in order to fight hunger in the families as security does its part to protect them.
Last year, the residents of Napak district suspended the use of oxen for ploughing over fears of being attacked by suspected warriors. The cattle were only kept from the confined kraals and only released during the day for grazing, and returned in the evening when the army took responsibility for keeping them.
Original Source: URN via The Independent
Mbarara struggling to contain Rift Valley Fever, no livestock quarantine yet
The government is reluctant at imposing the livestock quarantine on Mbarara despite registering five confirmed cases of death among humans resulting from Rift Valley Fever, the Resident District Commissioner, Emmy Turyabagyenyi Kateera has revealed.
According to Kateera , when they informed the Ministry of Agriculture, Animal Industry and Fisheries about the outbreak, they deployed a team on the ground to manage the situation. Mbarara District Veterinary Officer, Andrew Bakashaba, says that registered fifty cows infected by Rift Valley Fever in Rwanyamahembe Sub County on different farms.
He, however, says that they are currently managing the situation through sensitization. Bakashaba has warned residents against eating meat from animals that have died on their own, noting that Rift Valley Fever is only transmitted from animals to humans through infected meat.
He has also asked people to always watch out for meat that has a veterinary medical stamp as proof that it’s been tested and found to be clean. Turyabagyenyi said that they have directed extension workers to hold engagement and sensitization meetings with farmers and livestock traders on how to do self-preservation on their farms and the movement of animals.
He said they asked the Ministry of Agriculture to hold on imposing a quarantine as they monitor the situation on the ground noting that if the situation goes out of hand they would be left without any choice but to announce the quarantine.
He says they have deployed veterinary doctors at all known slaughter slabs and asked them to double-check the meat before and after it is delivered to butchers. Dr. Richard Atuhairwe, the in-charge of Bwizibwera Health Centre IV, says that the disease was detected among 30 people, and results from Uganda Virus Research Institute returned positive. He says that five of the thirty have since died.
Rift Valley Fever is an acute viral hemorrhagic fever that is most commonly seen in domesticated animals such as cattle, sheep, and goats and can also cause illness in people. It is caused by the Rift Valley Virus. Meanwhile, a Quarantine has been imposed on Byembogo Village in Nyabisirira Town Council after a case of foot and mouth disease was confirmed on one farm.
Turyabagyenyi says a farm belonging to one Mr. Mungonya with over 1500 cattle had been stopped from sending out cattle and animal products like milk from the farm. He says that they have also temporarily closed the Kyeshema livestock market that is shared between Kiruhura and Mbarara districts noting that Kiruhura had last week closed its side.
He says they are now moving to vaccinate all animals in the village as they monitor the situation.
Original Source: URN via The independent
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