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Out Growers Storm Kakira Sugar Factory Over Withholding tax

The farmers argued that their payments for cane supplied to the factory were subjected to a tax of 1280 Shillings for each ton, further eating into their meagre profits. The trucks are equally subjected to 5 percent taxes at the weighbridge.
Farmers pile stones at Kakira sugar works limited gate.

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Sugarcane outgrowers from areas around Busoga region have stormed Kakira Sugar Works Factory protesting the 1 percent withholding tax which took effect on July 1, as part of the new tax measures by the government.  

Government slapped a withholding tax on payments for agricultural supplies at a rate of 1 percent on a gross payment for agricultural supplies in excess of 1 million Shillings.

But the farmers argued that their payments for cane supplied to the factory were subjected to a tax of 1280 Shillings for each ton, further eating into their meagre profits. The trucks are equally subjected to 5 percent taxes at the weighbridge. They blocked the entrance to the factory and pelted stones towards the main entrance in vengeance.  

One of the farmers, Jomo Nkata says that government needs to halt any further collection of the taxes and first sensitize farmers on its relevance. They added that the tax measures they are being subjected to are exploitative.

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Meanwhile, the chairperson of Busoga sugarcane growers' association (BUSGA), Issa Budhugo, says that he received official information instructing him to sensitize farmers about the 1 percent withholding tax from Kakira sugar works limited last week.

Budhugo adds that on, June, 27, sugarcane farmers all over the country jointly petitioned the office of finance ministry on their dismay about the 1 percent withholding tax and they are waiting for his response.

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However, Kakira Sugar Works General Manager Christian Vinche is optimistic that the Ministry of Finance, will address the concerns raised by the farmers.

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