BUSHENYI,UGANDA – Government is set to write off more than Shs35 billion in tax arrears owed by tea factories as part of interventions to revive Uganda’s struggling tea sector.
Deputy Speaker of Parliament, Rt. Hon. Thomas Tayebwa, announced the development on Tuesday while representing President Yoweri Museveni at the burial of the late Mrs. Edna Kentaro Baryaruha in Bushenyi District.
Tayebwa said the waiver will be effected when Parliament resumes from recess, following sustained lobbying by MPs from Greater Bushenyi and other tea-growing areas.
“The minister directed that, when we resume Parliament, we will write off tax arrears worth more than UGX 35 billion. I want to thank MPs from Greater Bushenyi who have worked hard on this issue,” Tayebwa said.
The tax relief is expected to ease financial pressure on factories grappling with accumulated debts and operational challenges amid a prolonged industry crisis.
Tayebwa said government is also working to streamline management and operations of tea factories.
“The other issues will also be streamlined to ensure that factories are run better,” he said.
He revealed that government has earmarked Shs212 billion for investment in the tea industry, but only factories that demonstrate efficient and effective management will qualify.
The intervention comes at a time when Uganda’s tea industry has been hit by falling prices at the Mombasa auction, weak international demand, oversupply, and disruptions in key markets like Sudan.
High costs of fertilizer and inputs have further affected quality and yields, reducing factory earnings and farmers’ pay.
President Museveni last year engaged tea farmers and processors in Bushenyi over the crisis facing the sector.
