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Gov’t Withdraws Tax Exemption Plan for Companies that Gave COVID-19 Donations

Government has withdrawn plans to legalize tax relief to companies that gave COVID-19 donations after a fierce rejection from mainly the opposition Members of Parliament.

MP including Cecilia Ogwal of Dokolo district (FDC) and Jonathan Odur of Erute South (UPC) on Wednesday put a spirited fight against the Income Tax (Amendment) (No.2) Bill, 2020.

The Bill intended to amend the Income Tax Act, Cap.340 to provide for deduction of charitable donations made by persons to the Government of Uganda to fight COVID-19 pandemic, was read for the first time on the 17th June, 2020 and referred to the Committee on Finance, Planning and Economic Development in accordance with Rule 128 of the Rules of Procedure of Parliament.

Cecilia Ogwal disagreed with the Bill saying that the donations were made voluntarily and there is no need to exempt them from taxes. “People have been generously donating for years because we have gone through various disasters not only COVID-19. I would want to propose that if someone donates, he or she is giving back to the community from their heart and honestly expecting a tax concession from it is unafrican,” said Cecilia.

Hon. Odur said that it will be difficult to ascertain the value of some donations which they extended to government for tax exemption.

“How are we going to ascertain the value of some of the donations given to government? Some companies brought donations in one tonne trucks and they were saying it is seven tonnes,” said Odur.

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