Kenyan trucks with tonnes of potatoes stuck at border after Uganda raises levy

Trucks parked at the Busia-Kenya Busia border following the introduction of a new withholding tax by Uganda Revenue Authority (URA). PHOTO | DAILY MONITOR | NMG

By MONITOR

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Close to 30 trucks from Kenya loaded with tonnes of Irish potatoes are stuck at the Busia border after the Uganda Revenue Authority (URA) increased the withholding tax by up to 10 times.

Another 20 trucks were reportedly impounded by the tax agency in Jinja, about 120km from the Busia border, on April 12 when the new withholding tax policy was implemented.

According to importers of Irish potatoes from Kenya, they have been paying a withholding tax of Ush120,000 (about $32) for each truck. Now, URA, they say, requires them to pay Ush1,200,000 ($315) for each truck.

Ibrahim Bbosa, the URA Commissioner Public and Corporate Affairs said the tax agency had increased the withholding tax of six percent with a customs value of $0.4 (Ush1,560) on each kilogramme of Irish potatoes imported into the country. This increases the tax from Ush9 ($0.0024) to Ush93.6 ($0.025) per kilo.

Read: Uganda proposes new taxes on key products

According to Mr Bbosa, the product has previously been “undervalued”, the reason the tax body was reviewing it.