Government to Write Off Shs35 Billion Tea Factory Tax Arrears, Says Tayebwa

What the report says

Uganda’s government plans to cancel more than Shs35 billion in tax arrears owed by tea factories, according to Deputy Speaker of Parliament Thomas Tayebwa. Watchdog Uganda reported that Tayebwa made the announcement on Tuesday while attending the burial of the late Mrs Edna Kentaro Baryaruha in Bushenyi District, where he was representing President Yoweri Museveni.

The waiver is expected to take effect when Parliament returns from recess. Tayebwa said the move follows lobbying by lawmakers from Greater Bushenyi and other tea-producing areas, who have been pressing for action on the sector’s difficulties. He said the relief should help factories that have been weighed down by accumulated debts and operating problems, some of which have struggled to restart production.

The report said the government is also reviewing broader issues affecting tea factory management and operations, as part of a wider effort to stabilize the industry. This comes against a backdrop of weaker tea prices, oversupply, and higher production costs that have hurt farmers and processors in Uganda, which depends heavily on the Mombasa auction and exports mostly CTC black tea.

Tayebwa also said the state has a larger Shs212 billion plan for the tea sector, with funding reserved for factories that can show efficient and effective management. The announcement signals continued government intervention in a sector that has faced financial strain and reduced returns in recent months.