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Kotido Municipal Council in Tax Dispute with Traders

The new tax came into place in June, following a council resolution on May 31st, 2019. The tax is levied on per bag of produce sold within or brought into Kotido Municipality.

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The new tax introduced by Kotido Municipal Council on produce sellers has met stiff resistance. 

The new tax came into place in June, following a council resolution on May 31st, 2019. The tax is levied on per bag of produce sold within or brought into Kotido Municipality.

Each bag of produce is charged 2,000 shillings and it is currently being enforced amid serious protests from the produce sellers who have called on the Municipal Council to wave it off.

The produce dealers claim the tax is very high given higher costs of running business in Kotido.

They also claim that the new denies them the right to a trading license, a document legally binding their businesses.

Felix Arnold Adar, the chairperson Kotido Produce Dealers says the new tax is unfair on them since they pay District Development Fund which is charged on each bag from the districts they buy. He explains that the produce dealers, in addition to daily market dues have to pay another fee if they sell the produce in the open market within Kotido Municipality.

// cue in “This product we buy...

Cue out… injuries and unfairness.”//  

Earlier, there were suggestions by the sellers that the new tax would replace the Trading license, which had been suspended since January but the Town Clerk, Sereverio Mukobi has underlined that licensing will be reinstated immediately. He also revealed that market gate fees will remain in the municipality to raise revenue for council. 

The new development comes at a time when licensing to Produce dealers had been suspended, awaiting plans to introduce a new tax to the business community. 

//cue in “I want to emphasize that...

Cue out...paid by the seller”//

According to Auditor General’s Report for 2017/2018 Financial Year, Kotido Municipality registered a shortfall of UGX. 131 million from approved local revenue budget of 566.9 million shillings.  

Under the law, Local Councils are empowered to levy and appropriate taxes as additional responsibility on issuance of licenses. There are 34 registered produce sellers in Kotido Municipality, according to their chairperson, Adar.