The tax is on fuel already! MPs reject proposed tax on vehicles

Government seeks to direct tax from motor vehicle owners

KAMPALA – Legislators sitting on the finance committee have opposed the proposed new annual tax on all motor vehicles arguing that the government imposed a tax on fuel so it is not in order to impose another.

Recently, Finance Minister, Hon. Matia Kasaija, tabled proposals for the new tax laws, which would see motor vehicle owners part with an annual license fee paid by 31st of January.

Appearing before the committee this morning to defend the new tax proposal that was tabled before parliament last week, the state minister finance in charge of planning David Bahati said all motorists will be required to pay an annual direct tax of Shs 200,000.

He said this is intended to prevent road carnage because only road-worthy vehicles will be on the road and also raise some money for the treasury, a move that the committee has vehemently opposed.

Nandala Mafabi, one of the committee members says this tax will increase corruption on the roads and force many Ugandans to park their cars for years.

He says that government should instead impose a tax on fuel as opposed to vehicles.

The Traffic and Road Safety Act (Amendment) Bill, 2021 seeks to impose, under clause 14.A, a license to permit ownership of “a motor vehicle, trailer or engineering plant.”

To use the vehicles specified above on the road, one must possess a license, not to be confused with a drivers’ license.

Failure to have the license, proposes the new law, could see one jailed for two years, pay a fine of Shs2 million, or suffer both imprisonment and fine.

The minister tabled the proposals during the Thursday, 1 April 2021 sitting chaired by Speaker Rebecca Kadaga.

Additionally, an annual fee, to be determined by the Minister of Works and Transport by Regulations, is also to be met by a vehicle owner.

Failure to pay the annual fee, will lead to a fine of Shs 200, 000 accumulating every day from the date the fee was due for payment – 31st of January.


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