To tax or not to tax: MPs probe sh18.8b New Plan Ltd waiver

KAMPALA - Parliament's finance committee processing the finance ministry’s request to waive shillings 18.8 billion in taxes for New Plan Ltd, has adjourned.

For starters, it should be noted that the proposal to waive taxes for New Plan Ltd was tabled in Parliament on December 16, 2025 and subsequently referred to the respective house committee.

This unfolded on February 19, 2026, during a meeting between MPs on the committee chaired by Chekwii County MP Moses Aleper and the finance ministry. The latter was represented by Henry Wise Ssebbaale who is from the Uganda Revenue Authority (URA).

Others present included New Plan Ltd chairperson Lawrence Omulen.

As a parting shot, MPs resolved to dig deeper into the financial operations of the company, bank statements and certificate of ownership to ascertain whether the company’s predicament was occasioned by financial indiscipline or hardship.

This followed queries from Herbert Tayebwa (Kashongi County), who hypothesised that this matter could be a result of financial indiscipline.

“If someone goes and mishandles his money and then runs to you and say I don’t have money. The question should have been, did you charge any tax on nothing? To me, I find it absolutely not understandable that you are asking to waive a tax which you charged on income that was there then,” Tayebwa said.  

“What you call financial hardship or difficulty is actually financial indiscipline… First of all, how does the tax arise? A tax arises either on earned income or on any VAT transactions

COVID setback

Documents submitted to the committee show that the company, which has paid shillings 21.5 billion in taxes since 2010, hit rock bottom around the COVID-19 lockdown.
According to Omulen, in 2018, they were awarded a major contract to support the East African Crude Oil Pipeline (EACOP) project by TOTAL.

Consequently, he said, they had to mobilise resources through borrowing where it was necessary.

A feat Omulen attributed to the stringent requirements of the oil and gas sector.

“And we did survey the 300 kilometres pipeline from Kikuube right up to the border with Tanzania. I had to recruit quite many people. At the peak, we had over 700 professional engineers, valuers, surveyors, sociologists, lawyers and so forth. We did work, in the first phase, we were given only six months, and we finished. We did it to the satisfaction of the client,” he narrated.

In the next phase, New Plan was supposed to handle design, surveying, and assessing individual valuations of project-affected persons (PAPs).

However, he claims that the Government suspended operations of oil companies for nine months during this period.

“During the suspension, that work which was done became pro bono worth $3.5 million…. We were interested. As a local company, we thought we had clinched something that would give us experience in the region, and the client actually honoured his pledge and gave us two contracts to complete the resettlement and also to work on the design,” Omulen added.

However, shortly after in March 2020, the nasal corona virus set in, bringing the globe to a standstill.

Gentleman’s or legitimate contract

However, with Omulen stating that they were given a new contract while also saying they were ‘quietly’ allowed to work despite the suspension and that their work was pro bono, left many lawmakers questioning the legitimacy of the whole arrangement.  

“What is a gentleman’s agreement? That’s what I want to hear. There was no contract; you are just massaging the thing,” Aleper probed.

“So, you are an established company which works silently without contracts?” he further posed.

Tax woes

According to Ssebbaale, the backstory to this emanates from failure to comply with tax obligations.

“When the audit was conducted on the company, after some time. It was conducted in 2022, it was established that the company in the previous period had not been honouring the obligations to pay Withholding Tax and Pay as you earn (PAYE),” he revealed.

The audit in question was conducted in 2022.  Later on, URA in an effort to recover this money, was prepared to go all the way, including auctioning the New Plan’s properties.

However, it was stopped in its tracks after company wrote to President Yoweri Museveni calling for his intervention. Accordingly, URA wrote to its mother ministry asking for a way forward, which objected to taking extreme measures.

“In URA’s case, we evaluated the ability of the company to pay, the ability of the company to survive if we were to recover this entire shillings 18 billion, a number of employees at stake here and URA is convinced that the case is worth looking at in the interest of supporting the company and recommended the waiver,” Ssebbaale elaborated.

Source: Minister Henry Musasizi's submission to committee

Evidence of financial distress

Based on the audited financial statements and draft financials of New Plan Limited for the years 2019 to 2022, the company’s net worth position shows a declining trend from the positive net worth of sh3.69 billion in 2019 to a negative net worth of Sh8.94 billion in 2020 before plunging to a much bigger negative net worth of Sh20.178 billion.