Taxation and the Indigenous Property Owner/developer

Taxation and the Indigenous Property Owner/developer

Sam Mwaka-karama

SHOCKING – but the local and indigenous property owner and developer is an endangered species – this shockingly is primarily a situation affecting indigenous Ugandan businessmen and entrepreneurs.

Over the last three or four years, Uganda’s brand name property owners and developers have been quietly disappearing [as in dying away slowly] and, hardly do people notice, but the indigenous local rich and propertied are silently vacating their place in society.

Today [Friday 20^th June 2014 – a year ago from the date of publishing this blog post], I was in the Shell Bugolobi / Mall areas – and met a long time friend of the Kampala streets of the 1970s and 80s. A hard working person of my generation who is now an extensive property owner and developer allowed me conversation with him [name withheld] for over an hour.

As usual we had random chit-chat touching on nearly every topic strictly in the business and trade, entrepreneurship fields…

We have always been free with one another, despite the enormous economic divide now between us - so at a certain moment during our conversation, my mental alarm bell went off, as we drove away from the filling station area – when an employee of his had joined us in a brief drive towards Jinja road very much within town.

 My friend [a Muganda by tribe] who runs his empire from the sixth street, in Kampala, was sending his employee [also a Muganda] to his other businesses, making instructions – suddenly, I noticed a previously unknown characteristic in my friend, when his temper flared [over such a tiny issue – shouting!] at his long-time employee and, with that I saw a raw and deadly combination of pressure and hyper-tension live! [He was hospitalized months later].

Such that for an instant, as you are driving – your anger and tension might cause your neck to stiffen and for an angry moment you couldn’t look left or right with ease… in the maze of fast traffic!

I immediately was concerned even alarmed and, soon as the employee was dropped-off, I softened talks between my friend and myself – what I mean is, without having to be a physician – the obvious raw pressure and hype-tension I had seen that accompanied the eruption, was a telling enough symptom to trigger my mild inquiry into how life was with him lately… at least the last two years I wasn’t seeing him much!!

My friend just groaned and said - “O No.. Those URA taxation people are killing us”.

I have practiced journalism for three years in my life and, I am experienced enough in as far as Ugandan society and community existence were concerned – without being a radio talk show anybody - I have immense backlog of sociology materials and, journalistic experience to deduce a lot out of a tiny comment - I am capable of drawing from my book research and writing experience to place a very relevant and safe pointer on an issue.

The taxation killer… is a real phenomenon – in Property and Entrepreneurship.

Taxation is the undoing of property ownership and development in Uganda… unless some or an association of indigenous Ugandan property owners and developers come-up ASAP with a bright enough piece of parliamentary bill maker… petition in-which the indigenous Ugandan property owners and developers seek a partitioning of the law on property taxation - to separate between out-right foreign property owners and the local property owners if only in taxation regime terms. And again, if only to slightly scale down the pressure-point for the local Ugandans – and reduce on the s-t-r-e-t-c-h of the definition and emphasis on ‘struggle to live’! What actually trickles down to the ordinary citizenry with dire consequences – besides killing the welfare aspect of country existence completely.

Because, beyond every reasonable doubt the condition the Ugandan citizen entrepreneur goes under to build a structure at all, are extreme and, prohibitive. It is an effort against real, and enormous odds.

While an outright foreign property owner and developer may have come-in with foreign privately donated philanthropy capital and, overnight, easily invested in the open property markets in the country. The local developer generates capital the harder way. And, I think here the locals deserve concessions here.  

This taxation factor in combination with property regulatory ground rental fees and other trade charges regularly or annually paid; apparently home-in a combination of devastating impact on the property owners individual lives – who often have to hike their own property rentals beyond affordability of a larger percentage of the local business companies and individuals… as a result mostly, higher grade and prime properties weren’t fully rented all year round.

A cursory research might reveal that an average mall or plaza and block of flats or apartments, might have annual [un-occupancy] of up to 30% by average easily. What would, all the more, aid an indigenous association toward convincingly agitating for a valid parliamentary bill maker – to redress property tax laws.

This [flash and] very impromptu article my latest blog post, is not in any way meant to malice any foreigners doing business in Uganda, but an expression of concern with the life expectancy decline of property owners… who are evidently dying quietly of hypertension  and pressures. A valid area of human concern. Moreover, not an insult to any groups of people – but an objective overview. Actually written a year ago! ***      

Writer is an Independent Thinker, Author and Blogger