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Luwero, Uganda | THE INDEPENDENT | Newly elected councillors in Luwero district will receive less allowances due to loss in revenue in the next financial year.
Each district councillor in Luwero has been entitled to 400,000 shillings for allowances per sitting. After-tax deductions each councillor was getting a net pay of 313,000 shillings per sitting.
However, according to the approved district work plan for the financial year 2021/22, each councillor will receive 230,000 Shillings for allowances per sitting. There are six council sittings in a financial year.
Abdul Kalemera the Chairperson for District Finance Committee explains that the newly elected councillors will earn less compared to the outgoing due to the projected decline in revenue collections. This follows the creation of five town councils that are semi-autonomous and don’t remit anything to the district.
The town councils which include Kikyusa, Busiika, Ndejje, Zirobwe and Kamira are expected to start operations in July this year. Kalemera says sub-counties will remit less revenue to the district because they lost huge revenue sources from trading centres which have been elevated to town councils and operate as semi-autonomous.
Kalemera explains that each sub-county was supposed to remit 35% from local revenue and the district council uses part of the funds to run council business.
Hussein Kato the District Secretary for Finance explains that apart from the loss of revenue from sub-counties, the district is limping over the abolition of some taxes and the COVID 19 pandemic which greatly affected business.
Kato says that the district expects to collect at least a billion shillings as local revenue in the financial year but this is unlikely after the town councils retain their own collections as they start operations in July this year.
Kato said he has asked the Finance Department to see whether the councillors’ allowances can be increased to at least 250,000 shillings.
However, an official from the district finance department who preferred anonymity says that if the request is honoured, the allowances may reduce further over taxation.
“According to the law, any amount of allowance or salary above 235,000 is subject to taxes and an increase to 250,000 shillings means that 30% tax will apply,” the official said But Erastus Kibirango the LCV Chairperson elect for Luwero district said that the newly elected councillors will accept the available allowances since they were voted to serve not to get benefits. Kibirango however said when he takes over office, he will work with councillors and technical staff to enhance revenue collection to cover the gaps created after the elevation of trading centers to town councils.
Kibirango also promised to stop leakages in revenue collection.
Luwero District will comprise 37 councillors in 2021-26 elective term from 30 councillors in the 2016-2021 term.
The annual work plans for Luwero district have been approved by the district council.
The outgoing councillors are expected to sit before the end of the term in May this year to approve the district budget for the financial year 2021/22. Currently, Luwero operates a budget of 54 billion shillings of which 66% is used to pay salaries for staff, 21% non-wage and 13% for development.
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