Bus operators, united under the Uganda Bus Owners Association (Uboa), have officially lodged a complaint with the Ministry of Local Government regarding park user fees. The move comes in advance of a scheduled meeting with government officials today.
The Ministry of Local Government’s Statutory Instrument has authorized the Kampala Capital City Authority (KCCA) to impose an annual fee of Shs2.4 million on each medium-sized omnibus operator.
Fees Pile Up for Operators
Bus owners are also required to pay an annual government license fee of Shs2.84 million per bus. This fee encompasses Shs1.5 million as a Passenger Service Vehicle charge and Shs1.34 million designated as Advance Income Tax to the Uganda Revenue Authority. However, Uboa members argue that this financial burden is excessive when weighed against their operational costs.
Uboa Takes a Stand
In a nine-page document dated August 28, signed by Uboa chairman Solomon Nsiimire, bus proprietors are calling for the permanent suspension of the Shs2.4 million park user fee per bus. Robert Mutebi, the association secretary, asserted that the current economic conditions make it impossible to meet this obligation.
Mutebi stated, “We acknowledge that this decision was a result of discussions with stakeholders to replace various park charges. However, given the present economic realities, we find it unfeasible to comply with this fee.”
Proposals for Change
Uboa has outlined several requests in its petition to the government. Among them is the proposal for bus terminals managed by the association to alleviate the steep loading and unloading fees paid to private terminal owners. Uboa currently pays Shs53,000 for each bus’s loading and unloading at privately-owned terminals, a cost they believe should cover the park user fee.
Furthermore, Uboa aims to streamline the fees and taxes levied on buses. They advocate for consolidating the numerous and high charges into a single affordable payment. Part of the petition reads, “We request that all the taxes and levies required for obtaining a license be amalgamated into a total fee of Shs1.84 million per bus per year. This would encompass the Advance Income Tax of Shs1,340,000 and Shs500,000 for other levies.”
Uniform Licensing and Fair Taxation
Bus proprietors are also urging for a standardized Public Service Vehicle (PSV) license system to level the playing field for all operators. Additionally, they seek safeguards for long-route bus owners and a reduction in import duty taxation on buses.
Petitioners Extend Reach
The petition has been distributed to various government officials, including those from Internal Affairs, Trade, Industry and Cooperatives, KCCA and Metropolitan Affairs, State for Transport, the Commissioner General of Uganda Revenue Authority, the Executive Director of Kampala Capital City Authority, and the Commissioner of Transport Regulation and Safety.
Recent Demonstrations and Government Response
Last week, bus owners staged a protest by withdrawing buses from their routes. This action was prompted by KCCA’s actions, which led to the closure of bus terminals, alleging non-payment of the Shs2.4 million park user fee. Following government intervention and discussions, the strike was temporarily halted on Friday. This suspension will remain in place while the government reviews the formal petition and addresses the concerns raised.
Cross-Border Operators Join the Fray
Within the same petition, cross-border bus operators with foreign registration plates have also voiced their opposition to the park user fee. Companies such as Simba Cool East Africa Limited, Volcano Limited, Trinity Express, and SR Classic Coach Company Limited have echoed the same concerns.
The petition reveals that cross-border bus operators are subjected to commercial road user fees at every border crossing. This fee varies with the exchange rate of the dollar. Alongside these charges, they pay an annual PSV fee of Shs1.5 million, Advanced Income Tax of Shs940,000, Trading License fee of Shs512,000, and garbage collection fees ranging from Shs1.2 million to Shs2.4 million annually to KCCA.
Operators argue that the additional Shs2.4 million annual fee unfairly targets all bus operators, without considering the unique operations of cross-border bus services. As these buses solely transit from departure points to Kampala without picking up passengers within municipalities and towns of Uganda, the fee is perceived as both unjust and excessively burdensome. They request a review of the double taxation policy imposed on cross-border bus operators in Uganda.