Uganda Enacts Export Tax on Hides and Skins to Strengthen Local Tannery Industry
May 19, 2025 | Kampala – Uganda’s Parliament has passed the Hides and Skins Export Duty (Amendment) Bill, 2025, implementing a $0.80 per kilogram levy on all exports of hides and skins, including glue stock, in a bid to revitalize local tanneries and boost domestic value addition.
The bill removes previous tax exemptions that allowed glue stock and semi-processed hides to be exported tax-free, a move driven by concerns over raw material shortages in Uganda’s leather sector.
“The amendment seeks to enhance availability of raw materials for Uganda’s tannery industry and support local value addition,” said Finance Committee Chairperson Hon. Amos Kankunda.
Debate Over Glue Stock Classification
The bill sparked spirited debate in Parliament, particularly around the classification of glue stock—offcuts processed into a food item called ponmo, popular in West African markets.
Some MPs, including Hon. Dicksons Kateshumbwa, argued that if glue stock is exported as food, it should not fall under hide taxation. However, Attorney General Kiryowa Kiwanuka clarified that if URA classifies it as a hide-based product, it must be taxed accordingly.
Ultimately, the House upheld the levy on all hide-related exports to align with Uganda’s industrialisation goals.
Stamp Duty Bill Also Amended
Parliament also passed the Stamp Duty (Amendment) Bill, 2025, eliminating the Shs15,000 duty on agreements and mortgage deeds and replacing it with a “near-duty” classification.
Minister of State for Finance, Hon. Henry Musasizi, said the move is designed to ease contract registration and promote affordable credit access by reducing borrowing costs.
“To support access to affordable credit and promote business growth, the government proposes near-duty on mortgage deeds and mortgage of a crop,” he noted.
Attorney General Kiwanuka supported the initiative, noting that the amendment resolves long-standing issues such as the duty on employment letters and basic agreements.
Economic Impact
The combined amendments signal a shift toward supporting Uganda’s domestic industries, reducing export leakage, and encouraging formal financial transactions—key steps in boosting private sector growth.https://www.ugandaliving.com/1740/uganda-imposes-export-tax-on-hides-and-skins-to-boost-local-tanneries/
