East African Business Week recently reported that the Ugandan government will be investing in developing co-operatives. Many co-operatives in Uganda have become stagnant or failed because there is a lack of general know-how in running co-operatives, as well as limited access to value addition technology hindring their development.
KAMPALA, UGANDA - Limited access to appropriate technology for value addition by the cooperative societies in Uganda has been cited as a major hindrance to their development.
“Some of the cooperatives in the country are not performing at their best especially in adding value to agricultural products, because of inadequate access to appropriate technologies required in the value addition chain,” Amelia Kyambadde, the trade, cooperatives and industry development minister said recently.
“Other cooperatives are stagnant due to low capital contribution by members. However as Government we are working very hard to see that cooperatives perform better,” she said
She also mentioned gaps in the general know-how of how to run cooperatives. Kyambadde said although the number of registered cooperatives societies is increasing, the majority are struggling.
Kyambadde told a news conference the government will start training programmes to develop leadership skills and support cooperatives in accessing quality technology.
This year's International Day of Co-operatives's slogan is "Co-operatives: The power to act for a sustainable future".
This theme was chosen to highlight the large role co-operatives play in promoting the United Nation's Sustainable Development Goals of ending extreme poverty, fighting inequality, and fixing climate change over the next 15 years. Co-operative principles and development methods have been shown to alleviate poverty, promote equality and focus on the environment.
The day will be celebrated on Saturday, July 2nd, in Nakaseke, hosted by the Uganda Meat Producers Co-operative Union. Co-operatives, the Ministry of Trade, Industry and Co-operatives and other co-operative partners will gather together to celebrate the co-operative movement in Uganda, its achievements and promote co-operative culture. The events on the day will include an awards ceremony, exhibitions by co-operatives and partners in the industry, and entertainment.
Uganda Central Co-operative Financial Services will be a leading member of the celebrations, holding an exhibition on the day and taking part in planning committees.
Daily Monitor has recently reported that the government's previous pledge to write-off tax arrears of SACCOs comes because they plan to put on a new focus on collecting taxes from SACCO profits. There has always been a tax on profitable income of SACCOs (income generated from interest for example), but many SACCOs in Uganda did not know about the law; therefore, they have not been paying the taxes. The government says it will forget the past arrears accumulated from SACCOs because of the lack of knowledge, but will begin collecting in earnest in the next year.
Government wants all SACCOs to start paying tax. As an incentive to encourage them to start paying tax, government has decided to waive all tax arrears owed by SACCOs as at December 31 2015. The proposal contained in the Finance Bill 2016, means SACCOs who have outstanding tax liabilities to pay do not have to worry about these tax arrears any more.
Uganda Revenue Authority (URA) is going to write them off as uncollectable bad debts. The fact that government has found it necessary to write off all tax arrears owed by SACCOs should now be taken as a clear policy statement to all SACCOs in Uganda that as far as URA is concerned, SACCOs are supposed to pay tax.
SACCOs in Uganda are owned, governed and managed by members who have the same common bond. They are legal bodies registered under the Cooperative Societies Act. SACCOs are economic institutions involved in business activities for purposes of making a profit to grow, survive and become sustainable.