By KT Reporter
The government, through the proposed Income Tax (Amendment) Bill, 2025, is seeking another tax exemption to the Bujagali Hydro Power project up to 30th June 2032.
The Bill was tabled before Parliament on Thursday, for its first reading by the Minister of State – General Duties, Henry Musasizi.
Last month, the same Minister tabled the same Bill, seeking to extend the tax exemption to the power company up to 30th June 2025.
Subsequently, Musasizi appeared before the Committee on Finance, where Members of Parliament raised concerns about the management of preferential shares by Bujagali Energy Limited, arguing that the redemption of these shares had led to financial losses for Uganda.
Budadiri West MP, Nandala Mafabi, then stated that Bujagali Energy Limited (BEL) had unfairly profited from Ugandans through questionable accounting practices.
“You cannot remove money from a balance sheet without making adjustments. It is criminal to redeem shares and continue charging Ugandans the same high tariffs,” Nandala Mafabi argued.
The legislators also accused Bujagali of double-charging Ugandans. Nandala Mafabi emphasized that BEL earns significant profits at the expense of the ordinary citizen.
“They are getting a 19 percent return on investment and still making extra profits. This is cheating Ugandans under the guise of investment,” he said.
Between 2018 and 2021, the government granted the power company similar tax exemptions. However, in 2023, Parliament rejected the request by the government to award Bujagali another five-year tax exemption.
The Bujagali Hydropower Project, a 250MW facility commissioned in 2012, has long been a subject of controversy regarding its financial sustainability and cost to consumers.
While it was initially hailed as a solution to Uganda’s power shortages, concerns over its high tariffs and continued tax waivers have sparked criticism from both lawmakers and the public.
Meanwhile, the proposed amendments to the Income Tax Bill, 2025, also include the exemption of startup businesses established by a citizen for three years from tax.
This exemption, according to Musasizi, is aimed at encouraging entrepreneurship, supporting Small and Medium Enterprises, and stimulating innovation.
The Bill was referred to Parliament’s Finance Committee by the Deputy Speaker, Thomas Tayebwa for consideration-URN. Give us feedback on this story through our email: kamwokyatimes@gmail.com
