Cooperatives & Communities

MPs launch investigations into rice business at Mutukula border post

MUTUKULA– Legislators under the Parliamentary Committee on Trade, Industry, and Tourism have launched investigations into the alleged corruption and unfair competition in the rice trade at Mutukula border post.

This comes after different rice traders associations at Mutukula border and Kampala petitioned members of the committee complaining of unfair competition in the rice industry.

They accused the newly established apex body -Rice Agri-business Development Foundation [RADFO] and other stakeholders of blocking their trucks with rice at the border gate.

Magdalene Nassolo one of the rice traders said RADFO is forcing rice traders to pay Shs 180,000 per tonne of rice on the trucks before they are allowed to enter Uganda. She said they are also charged Shs 30,000 administration fee and yet they do not know where the money goes.

”Why is this company collecting taxes from rice businessmen yet such taxes they are not in the gazette of URA,” she asked. She said they do not know how RADIFO was appointed as an apex body to manage the rice imports from Tanzania.

RADFO headed by Hassan Sekabira was established at Mutukula border post and launched on September 30, 2021, at the function that was officiated by the First Deputy Prime Minister Rebecca Kadaga who doubles as the minister for East African Community Affairs.

The chairperson of the committee, Mwine Mpaka said the committee received complaints from rice traders and that is why his committee has decided to go to Mutukula border post to do physical observation over the allegations and later will come up with general recommendations that would help the rice industry in the country.

Mpaka said as a committee they are trying to establish the circumstances under which RADFO was appointed by the ministry of trade and it has been allegedly extorting money from rice importers which is Shs 180,000 per tonne of rice and this apex body seem to have protection from certain forces.

”We are also investigating legality of RADFO as an apex body and officials in the ministry of trade and who facilitates this body to carry out this mandate” he said adding that his committee will come up with recommendations to help traders to carry out their activities without any interference,” he said.

Mpaka said their preliminary investigations have revealed that RADFO is conniving with some URA officials, clearing agents, and security personnel to obtain money by false pretence which has caused financial crimes and loss to rice traders who spend more than five days with their trucks at the border.

MP for Buhweju, Francis Mwijukye said there is a syndicate between URA officials at the border, the clearing agencies, and RADFO. ”URA, RADFO, clearing agents, and security organs at Mutukula border are in a syndicate which has brought unfairness amongst the importers of rice at Mutukula,” he said.

He said government has lost money it would get through taxes. Some people are being exploited by others not paying taxes and RADFO is taking a lot of money without paying taxes.

MP for Sheema County, Prof. Elijah Mushemeza said some people who are not traders have been getting trading permits to engage in the rice business.  We are going to analyse the element of corruption and abuse of office, URA failed in its responsibility and the country is losing a lot of money.

He said URA abolished VAT but RADFO an appointed apex body is instead collecting money and replacing VAT yet this undermines the free movement of goods and services within the East African Community.

The Chairperson of RADFO, Hassan Sekabira denied the allegations put against his company saying that it was legally appointed by the ministry of trade to improve the rice trade but there are some traders who want to spoil the image of the company.

”There is no way we are causing unfair trade in the rice business and our aim is to end imbalances in the rice trade industry,” he said. He said RADFO signed a memorandum of understanding between the Tanzania rice exporters whose aim is to get rid of the imbalance in the rice trade between Tanzania and Uganda.

Appearing before this parliamentary committee, URA Customs Assistant Commissioner in charge of goods and services, Asadu Kigozi Kisitu said URA is not facilitating RADFO to collect money in replacement of VAT. He said they do not know about the money collected by RADFO.

He said government had earlier instituted VAT on rice but later some rice companies petitioned court complaining of unfair  VAT which URA collects. VAT on rice was abolished after court put an injunction on URA.

”Being that we are in the East African Community, there is no import duty charged on rice at any entry border point. As per the URA’s mandate we are ensuring that all the rice that all companies would bring in from Tanzania, moves on nil tax to Uganda,” he said.

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