Beer, water and cement tax

Beer, water and cement tax
Published: 21 June 2006

Uganda’s Dr Ezra Suruma unveiled a budget designed to encourage savings, create a Ush100 billion ($57.1 million) Energy Fund to fight the crippling power crisis and allow President Yoweri Museveni’s government to throw money at the grassroots in order to raise household incomes.

The Finance Minister admitted in his speech to Parliament last Thursday that the 2006/7 budget, the second under his watch, was "particularly challenging" due to a prolonged drought that led to the lowest growth in agricultural productivity in 15 years and a power crisis that has slashed economic growth and performance.

Suruma chose, therefore, to raise money from where it would least hurt, by raising excise duty on non-malt beer from 20 to 30 per cent, imposing a new 10 per cent levy on bottled water, and a Ush500 (28 US cents) specific tax on 50kg bag of cement, with all three interventions expected to bring in
Ush13.6 billion (US$7.78m).