Road licence tax was misguided!
Jun 20, 2007
SIR — Your article “Drivers prefer road licence tax to fuel levy†published on Monday was interesting because it highlights the inherent economic inefficiency of the old road licence tax regime. Under the old tax regime, a bus, which according to the article, travels over 500 miles a day, usin
SIR — Your article “Drivers prefer road licence tax to fuel levy†published on Monday was interesting because it highlights the inherent economic inefficiency of the old road licence tax regime. Under the old tax regime, a bus, which according to the article, travels over 500 miles a day, using 400 litres of fuel, only paid about sh890,000 in tax.
A 2.4-litre diesel Toyota Prado passenger car paid about sh750,000 in tax, but probably covers no more than 50 miles and consumes at most 10 litres of fuel a day. This means that the bus, which puts 10 times more pressure on our roads and the environment, was paying about the same tax as the car! It is good this distortion has come to an end.
Moreover, the bus owners’ complaints about passenger cost are really not justified. If we go by their figures, the daily increase in tax is sh32,000. But assuming the same bus carries 50 passengers in one day (over the 500 miles travelled), this amounts to an increase of sh640 per passenger for a full day trip or sh1.28 extra per mile. This is a modest increase, and the bus driver’s association should accept the fair share of the burden.
Deborah Akatujuna
Kampala
SIR — I wish to thank the finance minister Dr Ezra Suruma for the wise idea of scrapping the road licence. Firstly, it will make defaulters and those who were forging licence stickers pay without question. Secondly, it will make the Government officials, ambassadors, expatriates and even the President also incur the cost. And lastly, it will reduce corruption among the traffic police. The traffic police were the major cause of defaulters, simply because
after getting the culprits, the officers would just settle for kitu kidogo and the driver would just drive away. This would leave a small percentage of honest people to bear the burden of the defaulters and the so called VIPs. Thumbs up,
Dr Suruma.
Paul Mukiza Nfite
Kampala
A 2.4-litre diesel Toyota Prado passenger car paid about sh750,000 in tax, but probably covers no more than 50 miles and consumes at most 10 litres of fuel a day. This means that the bus, which puts 10 times more pressure on our roads and the environment, was paying about the same tax as the car! It is good this distortion has come to an end.
Moreover, the bus owners’ complaints about passenger cost are really not justified. If we go by their figures, the daily increase in tax is sh32,000. But assuming the same bus carries 50 passengers in one day (over the 500 miles travelled), this amounts to an increase of sh640 per passenger for a full day trip or sh1.28 extra per mile. This is a modest increase, and the bus driver’s association should accept the fair share of the burden.
Deborah Akatujuna
Kampala
SIR — I wish to thank the finance minister Dr Ezra Suruma for the wise idea of scrapping the road licence. Firstly, it will make defaulters and those who were forging licence stickers pay without question. Secondly, it will make the Government officials, ambassadors, expatriates and even the President also incur the cost. And lastly, it will reduce corruption among the traffic police. The traffic police were the major cause of defaulters, simply because
after getting the culprits, the officers would just settle for kitu kidogo and the driver would just drive away. This would leave a small percentage of honest people to bear the burden of the defaulters and the so called VIPs. Thumbs up,
Dr Suruma.
Paul Mukiza Nfite
Kampala