Paschal B. Bagonza
June 29, 2012
Three women are each carrying a 20-litre empty jerrycan. They look scared, and are running away from a locked water tap. The padlock reads “18% TAX.” It is a sweaty run to the well to collect water. One of the women has a baby strapped on her back; of course, they are barefooted. The well where they are running to has some very happy, but thorny members therein. These members include cholera, hepatitis, dysentery, typhoid, polio, guinea worm and scabies. One of the members (Cholera) in this well shouts, “Long live the budget.”
This is a cartoon in a local daily, The New Vision, talking about how the minister of finance, planning and economic development, Maria Kiwanuka, reinstated the 18% Value Added Tax (VAT) on piped water in the 2012/2013 Financial year national budget. She said the reinstated tax will contribute over Shs 24 billion to the national treasury
The reinstating of the tax has generated debates in taxis, amongst boda boda riders (riders of commercial motorbikes), cooks, washing bay operators and schools among many others. This is because water as a resource, is the very basic of being, just like life.
In one of the debates in a commuter taxi a woman quips, “Balalu okwongeza omusolo kumazzi” (are they [Government] mad to increase water tax).
A 20-litre jerrycan of water was being sold at between Shs 150 and Shs 200, depending on the location and scarcity of the resource. There are fears that water prices are going to double or hit Shs 500 per 20-litre jerrycan. Certain boarding schools and landlords are planning to shift the burden of the tax to their students and tenants respectively.
There are fears that manufacturing industries are going to heap the burden on the final consumer by increasing commodity prices.
According to Water Aid, 33% of Uganda’s population does not have access to safe water, and 52% of people are without sanitation. Infant mortality stands at 130 in 1,000, and 26,000 children under the age of five die every year die from diarrheal diseases.
The ministry of water and environment says access to safe water in urban areas (mainly through piped water supplies and boreholes, as well as shallow wells in small towns), currently stands at 66%.
In an exclusive interview with Water Journalists Africa, at Makerere University, a PhD Research Fellow at the UNESCO-IHE (Institute for Water Education), Ezrah Natumanya said the tax means that more people will not be able to access water, thereby reducing the water coverage in the country.
Natumanya said what would have been done is to “increase the fares for the industries and rich people, but not for the poor people.”
He said given the anticipated price increment of water people are going to start consuming untreated water and from local sources.
Natumanya said it would also be “good for the government to review the issue of reinstating VAT on water.”
He is worried that since people are going to avoid using tap water due to anticipated price rise, they are going to suffer from many water borne diseases. He added that people are also going to resume using pit latrines instead of flushing toilets because of the water costs. The use of pit latrines, he said, will expose the environment to more diseases and bacteria.
Natumanya has been working at Makerere University Institute of Environment and Natural Resources since December 2006. He is currently the chairperson of WaterNet Alumni.
He has previously written papers, supervised students and has research interests in hydrology, water supply and sanitation, integrated water resources management and climate change – impacts and adaptations in the water sector.
According to Natumanya, scientific studies show that every Ugandan uses over 25 cubic metres (about five 20-litre jerrycans) per day.
A private environment consultant in water resources management, Danson Asiimwe, told me that the government didn’t take due diligence in reinstating the tax.
Asiimwe said the tax is going to increase everything and that with time, a common person will feel the pinch. He said consumers will have to shoulder the tax load through high prices levied by manufacturing industries, because they want to meet their huge water bills.
He said the reinstating is also like the government is “legalising water borne-diseases. Saying that it is ok we can have water borne diseases as long as we collect our money. I think it is not okay,” Asiimwe observed.
80% of diseases in developing countries are caused by contaminated water.
Like Natumanya, Asiimwe is also worried that the moment the cost of a jerrycan from piped water source increases, people will resort to unsafe sources/wells. “Rather than pay Shs 2 per 20-litre jerrycan, people would instead go to fetch water from unsafe sources. In the end, the diseases we have been trying to eliminate will come back, especially in urban centres.”
MPs vow to fight the tax
The speaker of parliament Rebecca Kadaga said Parliament is going to fight the reintroduction of VAT on piped water.
Kadaga said the previous parliament rejected this proposal and wonders as to why the government is reintroducing it, Kfm reported.
“In the seventh and eighth parliament, we rejected that proposal. We had a big battle over it with the ministry of finance. We defeated them that time, but now they have brought it back. I am sure the members of parliament are getting ready for another battle,” Kadaga said.
She said parliament is ready to fight the proposal, which is likely is to have a negative impact on the lives of many Ugandans.
“I don’t know what reason she [minister of finance] is going to give now for justifying it, because we defeated it logically. But let’s see what she has to say this time.
Other MPs opposed to the tax are John Ken Lukyamuzi and Ronald Reagan Okumu. The legislators said the reintroduction is going to make it hard for an average person to access clean water, especially those in rural areas.
Lukyamuzi echoed Natumanya’s worry that the reinstating of the tax on piped water will lead to an increase of water born diseases as people look for alternative sources of water, because they can’t afford it.
The opposition Forum for Democratic Change spokesperson Phillip Wafula Oguttu said his party cannot accept that tax.
“You don’t increase taxes on beer, but put VAT on water for poor people. Water is life, and we hope we shall mobilise our colleagues in parliament…that that tax is defeated.”
However, Gomba County MP Rosemary Najjemba Muyinda defended the reinstating of the tax saying this will be used to extend clean water to rural areas.
According to the UN, about 1.1 billion people the world over cannot access safe drinking water, and still 2.6 billion people lack adequate sanitation.
The UN adds that because of this massive sanitation figure, 1.8 million people die every year from diarrheal diseases, including 90% of children under the age of five.