What you need to know:
- Income. Government has provided a number of taxes under the Income Tax Amendment Bill through which Uganda will earn from the oil and Gas sector as a country.
Sunday, 20 March 2022 06:00
How govt will earn from oil, gas sector
Now that the oil development stage has started, it is easier to connect the dots on how the private sector will directly benefit from the resource.
A number of contracts have been drawn while hundreds or even thousands of others, are still in the pipeline.
However, beyond individual or company level benefits, the question is; how does Uganda, as a country, earn from the oil and gas sector?
Pamela Natamba is the head of oil and gas division at PricewaterhouseCoopers (PwC).
In her assessment, as a country, during the development stage, Uganda will mainly earn through taxes, given that there will be no commercial production until 2025.
Therefore, she notes, such earnings have been provided for in the Income Tax Amendment Bill, which particularly focuses on the oil and gas sector.
“That Bill has made specific provisions, but one of them which is very interesting is it introduces a Windfall Tax,” she says and notes that this tax will apply to licensees that have signed Petroleum Sharing Agreements, many of which have been involved in exploration up to the point of production.
These, she says, include large companies such as TotalEnergies, CNOOC and Uganda National Oil Company (UNOC), among others.
What the Bill puts in place, Natamba says, is that as long as you earn revenue in excess of a certain amount, you will be subjected to a Windfall Tax.
For instance, she explains, if international oil prices are expected to go for a certain amount you a company sells beyond what has been projected, the expectation is, the company will pay an extra tax over and above 30 percent.
Published in
Energy
Sunday, 20 March 2022 08:45
Govt starts forceful evictions in Sango Bay Estate to pave way for oil palm project
What you need to know:
Out of the estimated 10,000 households, the government says it’s ready to compensate only 300 who are bonafide occupants
Government has commenced forceful eviction of people in the vast Sango Bay Estate in Kyotera District to pave the way for oil palm growing expected to start next month.
Since Thursday, bulldozers have been pulling down structures of people who reportedly encroached on 247 square miles.
Out of the estimated 10,000 households, the government says it’s ready to compensate only 300 who are bonafide occupants.
According to assistant commissioner of police, Mr Godfrey Matte who is spearheading the eviction exercise, they are enforcing a directive issued by State Minister for lands, Mr Sam Mayanja last month.
Credit: Daily Monitor
Published in
Politics
Thursday, 04 April 2019 00:00
Umeme counter rallies large trading volumes in three days
Kampala. Following a growth in dividends by five times for 2018 to Shs40 per share from 2017’s Shs7.6 per share, foreign institutional investors are buying Umeme shares as others opt out.
The Umeme counter has grossed Shs8.68b in the past three days from a sale of 28 million shares.
This has been a generally rare occurrence on the Uganda Securities Exchange given the volume and amounts involved.
According to an industry source who asked not to be quoted because they are not authorised to speak officially on the matter, the trend is driven by institutional investors.
“These are institutional investors,” he said, adding: “The ones that are selling have held the Umeme shares for a while and at this point they have nothing to lose as the share price itself is not bad.”
For those who are buying the aggregated 28 million shares bought in the past three days would fetch a dividend of more than Shs1.12b, which is worth the investment in that short time.
In 2017, regulatory requirement chopped off Shs115b off its profits to close that year with only Shs35b.
In 2018 the company almost quadrupled its profits at Shs132b thus the accruing dividend.
Umeme has been recording some good growth, especially in customer numbers which have grown to 1.3 million customers as of close of December 2018.
The shift to prepaid metering for most of its customers has greatly improved Umeme’s revenue streams.
However, the company still faces challenges such as collecting outstanding debts from government, where arrears of power bills are increasingly becoming exorbitant.
In the last six months, Umeme connected at least some 46 new industrial customers that have greatly boosted its numbers.
Source: Daily Monitor
Published in
Market
