Private Sector Foundation asks government to pay all domestic arrears to increase liquidity
Private Sector Foundation Uganda (PSFU) has asked Government to consider paying all domestic arrears to increase liquidity in the economy as a measure to revive the economy post COVID-19 lockdown.
The PSFU chairman Elly Karuhanga said in a statement that they had held discussions with their partners and the Ministry of Finance and agreed that this was on top of the many interventions that government ought to implement to resuscitate the economy.
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Karuhanga said that PSFU agreed with the Ministry of Finance on intervention areas, key of which is for the government to pay all domestic arrears to increase liquidity in the economy.
Domestic Tax
Karuhanga also called upon government to pay outstanding VAT refunds, defer payroll tax payments to ease business cash flows for the next six months and lower taxes on products that are produced with locally sourced raw materials.
The statement suggested that, “Tax on rental properties be frozen for six months effective April 2020 and no taxes should be increased on rental properties.”
Financing
Karuhanga asked government to restructure the country's finances and let the Uganda Development Bank (UDB) to manage the new development bank dynamics.
“Capitalise UDB so that they can effectively support the financing requirements of Ugandan entities. UDB should aggressively support upstream and downstream chains,” Karuhanga noted.
Karuhanga also asked that government support the tourism sector which has severely been hit by the pandemic with a line of financing through the UDB.
Production
Karuhanga asked that government should promote producer groups and cooperatives and an efficient warehouse receipt system to ensure food security.
He asked that government enhances the Buy Uganda Build Uganda (BUBU) initiative in order to ensure import substitution and make the young population able to find it attractive to go into manufacturing and value addition.
Karuhanga said that the PSFU is now organising an e-conference that is intended to reach very many Ugandans to discuss and agree on measures that can be taken in the medium to long term to get Uganda better prepared for similar crises in the future.
