Uganda’s Parliament has approved a new law that puts a tax on all exports of hides and skins. This includes glue stock, which is now taxed at $0.80 per kilogram. The government hopes this move will help local tanneries get more raw materials and grow the leather industry inside the country.
Until now, some products like glue stock and semi-processed hides were allowed to leave the country without any tax. But local tanneries were facing shortages.
Lawmakers believe the new tax will encourage companies to process more hides in Uganda instead of sending them abroad.
“The amendment seeks to enhance availability of raw materials for Uganda’s tannery industry and support local value addition”
Hon. Amos Kankunda, Finance Committee Chairperson
One major point of debate was how to treat glue stock. This is made from leftover animal parts and is often turned into a food item called ponmo, which is popular in West Africa.
Some Members of Parliament, said if glue stock is sold as food, it shouldn’t be taxed like a raw hide. But Uganda’s Attorney General disagreed. He explained that if the Uganda Revenue Authority (URA) treats glue stock as a hide-based product, then it falls under the new tax rules.
In the end, Parliament agreed to tax all hide-related exports. The goal is to protect local industry and support Uganda’s larger plan for industrial growth.
Source – Parliament of Uganda
