Uganda’s Excise Duty Scaring Investors

troche geneva; font-size: small; line-height: 200%;”>Prime Minister Amama Mbabazi learnt of this development when Coca Cola’s President for Eurasia and Africa, Nathan Kalumbu paid him a courtesy call at his office on Thursday.

Coca Cola are global bottlers of non-alcoholic beverage concentrates and syrups, with bottling plants in Uganda, while excise duty is a tax charged on goods produced within the country.

Kalumbu complained that the tax at 13 percent was too high compared to Kenya’s 7 percent and Tanzania’s 9 percent. He requested for a reduction to these levels, saying it would attract more investment and enable government to collect more revenue through other forms.

Mbabazi assured the private sector that Government will continue improving the investment climate to enable them bring in more direct investments, expand their businesses and provide employment.

“Your case is very clear if that affects your product price and I think this is an ideal climate for investment,” Mbabazi observed. He said Uganda was a popular destination for foreign direct investments and the government would do much to attract more.


“We do not take investment lightly and we discussed these issues in Cabinet, so you are likely to see a few changes in the coming weeks,” Mbabazi said. He attributed increased foreign investments to investors being able to bring in or take out their money freely.

According to the latest World Investment Report, Uganda is the top investment destination ahead of her East African counterparts. The improved performance is partly due to the increased investments in oil manufacturing and services sectors.

Mbabazi said the government had prioritized infrastructure as enablers of business, adding that more than a quarter of this year’s national budget was earmarked for roads and energy. More than Shs 4trillion was set aside for the purpose this financial year.

Mbabazi observed that whereas 851 megawatts (MW) of electricity is currently generated in the country, three steel manufacturing plants require 356MW between them. He noted that Hyundai, a car manufacturer in South Korea alone uses 4,000MW.

Norton Kingwill, Coca-Cola’s country managing director, said discussions on the excise duty were initiated with the Ministry of Finance and hoped that the company’s cry would be heard.

Peter Njonjo, general Manager of the Coca Cola East Africa Franchise based in Nairobi, said Kenya’s tax started at 15 percent but came down to the current 7 p[ercent. The company’s Central, East and West Africa Business Unit President, Kelvin Balogun also attended.

Founded in 1886 by a pharmacist, Dr John Stith Pemberton in Atlanta, Georgia in the USA and taken over in 1892 by another pharmacist, Asa Griggs Candler the Coca?Cola Company now produces over 500 brands.

Headed by Muhtar Kent, a Turkish-American business executive as the Board Chairman and Chief Executive Officer it is still based in Atlanta, with operations in over 200 countries.

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