Taxes on used clothes, shoes and bags have been revised by Uganda Revenue Authority (URA) from $1.17 per kilogram back to $0.89 per kilogram.
This follows a meeting held at URA Tower on Tuesday, 15th November 2022, between the Commissioner Customs and the Executive Committee of Uganda Dealers in Used Clothings and Shoes Association.
According to Abel Kagumire, the URA Commissioner Customs, the meeting was held to harmonize the matters of high taxes on second hand clothes, shoes and handbags raised by traders of used items through their representatives.
The Uganda Dealers in Used Clothings and Shoes Association Chairperson, Andrew Rubeihayo said that they wrote to URA Customs after URA stopped clearing their goods on 5th November 2022, resulting from a tax increment in their business. They held a meeting where they resolved to revise the taxes back to the previous as they stood in 2018.
He added that there was a tax increment of about Ugx40million shillings previously before the meeting was held, considering an addition from $0.89 per kilogram in January 2018 to $1.17 per kilogram in 2022. However after the meeting they agreed to reduce the taxes to $0.89 per kilogram of the used items imported.
“We wrote a letter to URA requesting to have an engagement over the continued increase in taxes of used clothes, shoes, among other items, following complaints raised by traders. On 5th November this year, URA stopped clearing items for traders who hadn’t cleared the tax increment,” Rubeihayo said.
Rubeihayo revealed that URA has previously increased taxes thrice without following the policy amendments and or the East African Community Management Act, but all was reached to an agreement in the meeting.
“URA has been increasing taxes continuously without following the policy amendments and the East African Community Management Act. For instance, between April 2021 and November 2022, the tax body has increased taxes thrice and the latest increment was instituted without either warning or notice,” Rubeihayo stated.
“However, all this was settled during the meeting,” he added.
The business of second-hand items employs over 1.5 million people in Uganda both directly and indirectly thus contributing to a vast percentage of the needed income to the government.