Parliament Approves President's Proposals on Plastics Tax and Casino Levy

Members of Parliament have voted to adopt President Yoweri Museveni’s recommendations concerning two key financial bills. This includes a revised approach to taxing single-use plastics and a new levy on land-based casino winnings.

Regarding the Excise Duty (Amendment) Bill, the House agreed to maintain a lower excise duty on single-use plastics. Instead of the initially proposed 25% or US$1,500 per tonne, the duty will remain at 2.5% or US$70 per tonne, whichever is higher. The Committee on Finance, Planning and Economic Development advised that a comprehensive study on the industry’s impact is necessary before implementing a significant tax increase. The committee also advocated for expanding the tax to cover more single-use plastic products while safeguarding exemptions for reusable plastics, sanitary pad packaging, and pharmaceutical products. A study on plastic taxation is expected within six months.

However, the decisions were not without debate. Some members, like Hon. Gyaviira Lubowa, questioned the legislative process, arguing that the current Parliament should not revisit bills passed by the previous one. Concerns were also raised about the government’s shifting stance on plastic taxation and potential revenue losses, with estimates of forgone revenue varying significantly between reports.

On the Income Tax (Amendment) Bill, Parliament approved the removal of a tax exemption for winnings from land-based casinos. This aligns with the President’s proposal to ensure equitable taxation across all gaming activities, including national lotteries. The Chairperson of the Finance Committee, Hon. Maximus Ochai, stated that this measure is crucial to prevent tax avoidance and protect an estimated Shs65 billion in projected revenue.

Despite some dissenting voices and minority reports focusing on revenue implications and legislative procedure, the majority of Parliament supported the President’s proposed amendments. This ensures that winnings from land-based casinos will now be subject to withholding tax, similar to other betting and gaming activities.

Source: https://www.parliament.go.ug/index.php/news/4526/parliament-backs-president-plastics-tax-casino-levy