By KT Reporter
The Busia District Council has resolved to take the Attorney General to the Constitutional Court over the scrapping of gold royalties.
In the 2020/2021 Financial Year, President Yoweri Museveni ordered the removal of gold royalties as part of efforts to attract investment for a new gold refinery, aimed at creating a favourable tax regime for investors.
Busia District LCV Chairperson, Stephen Mugeni Wasike, says the district is losing up to Shs328 billion annually in royalties that were expected from Wagagai Mining Company—funds he says would have significantly accelerated development in the area.
Mugeni revealed that during a council meeting held on Thursday, councillors resolved to sue the government, specifically the Attorney General. He made the disclosure while addressing a function where Christmas packages were donated to elderly persons on Friday at the Wagagai Mining Company premises.
The district council resolution seeks constitutional interpretation on several issues, including whether regulations can abolish royalties when the Mining and Minerals Act provides for them.
Councillors are also questioning whether Shs120 million paid as property tax is adequate for an investor reportedly earning between Shs7 trillion and Shs35 trillion.
Another key concern raised is whether local governments and host communities are entitled to a 15 per cent shareholding paid by investors to the central government.
According to Mugeni, district leaders had earlier assured landlords during compensation that they would receive five per cent annually from royalties in line with the Mining and Minerals Act. With Wagagai now actively mining gold, the district wants royalties reinstated.
Mugeni said that if the Constitutional Court allows the reinstatement of royalties, the district would earn Shs328 billion annually—funds he says would finance key development priorities.
James Ekulate, the Chairperson of the Grievance Redress Committee, said several unresolved issues remain, including the promised five per cent annual payments to landlords, which he wants the district to help address.
Muhammad Namudia, one of the landlords, said they have waited in vain for the promised five per cent share. He appealed to government to intervene, noting that the promise was a key factor in their decision to give up land for gold mining.
Mugeni added that the district aims to ensure that the 93,532 households in Busia each earn up to Shs77 million from proceeds generated by Wagagai. He said projections indicate that the investor’s earnings could rise to Shs67 trillion once deeper gold deposits are accessed.
Wagagai Mining Company is among the largest gold mining firms in East Africa. It operates in Mawero Parish and is expected to produce 10,000 tonnes of purified gold annually.
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