Members of Parliament have rejected the government’s attempt to impose a Ugx300 levy on kerosene.

The proposal was part of the new levies on other commodities, including mineral water, where the government imposed a fixed rate of Shs50 per liter of mineral water presented to Parliament by the Finance Ministry.

In the Excise Duty Amendment Bill 2024, which Parliament has passed into law, the government increased the levy per liter of petrol from Ugx1,450 to Ugx1,550 and imposed Ugx500 per 50 kg of lime, adhesive, and grout.

Whereas the legislators adopted the proposal to impose a 0.5% levy on cash withdrawals on payment systems, they voted to have agency banking excluded from this category in order to boost efforts for financial inclusion.

The charge will now be imposed on new payment platforms like Chippa Cash and Wave, among others. Once signed into law, it implies that from the new financial year on, the cost of fuel, mineral water, and building materials will increase.

The proposal attracted stiff debate from several legislators, including MP Ibrahim Ssemujju of Kiira Municipality, who had wanted to have the Excise Duty (Amendment) Bill 2024 recommitted to the Committee stage to delete taxes on packaged drinking water, petrol, diesel, and building materials.

Lwemiyaga County MP Theodore Ssekikubo said an additional levy is unwelcome and proposed that the tax regime should be maintained as it stands, on account of businesses struggling, and that any additional levy on fuel will give reason for transport operators to hike prices.

Speaker Anita Annet Among, in her ruling, defended the exclusion of a levy on kerosene, citing the failure of the government to extend electricity across the country, thus condemning the poor people to only use kerosene for lighting and saying that any charge on kerosene would impact their incomes.

“When you look at fuel, the increase is Shs100, but when you look at kerosene, where there are so many people using it, you are increasing it by Shs300. What kind of mathematics was that? What was the basis of that increment? Since we removed the Rural Electrification Agency, electricity has failed to reach the villages; we are removing kerosene, and it affects the local people, who can’t afford to fuel a car,” Speaker Among said.

The Excise Duty (Amendment) Bill 2024 that was passed by the parliament will now be forwarded to President Yoweri Kaguta Museveni to sign it into law.