Government told how to increase low-cost houses

Government needs a housing policy to regulate the sector and a simplified tax system with exemptions to attract the private sector to invest in low-cost houses.

KAMPALA – Government needs a housing policy to regulate the sector and a simplified tax system with exemptions to attract the private sector to invest in low-cost houses.
Many Ugandans live in semipermanent houses, especially in slums and up country. 
According to Uganda's Financial Sector Development Strategy (FSDS), Uganda has a housing deficit to be Shs1.6 million units, with an increasing annual requirement of between 180,000 and 210,000 units. Given rapid rates of population growth and urbanization, a widening housing need may overwhelm cities in the near future.
Uganda Revenue Authority (URA) taxes players in real estate Value Added Tax (VAT) 18 percent and withholding tax 6 percent. Local governments also collect property taxes that are determined by respective local councils.
“The housing sector is not regulated, which means no standards in place for authorities to enforce. This calls for a housing policy in place," said Andrew Epenu, the Sales and Marketing Manager, Nationwide Properties Ltd. Adding, "Anyone who is borrowing from lending institutions for a mortgage should be given a loan at affordable rates. The current rate of 17 to 20 percent is too high. We have many taxes that should be amalgamated into one tax like it is in India (10 percent)”
Asked what makes Nationwide Properties exceptional on the market, Andrew said, “Our approach to building new homes is based on a unique set of principles that ensure we are the country’s premier developer in the residential sector. You can expect the highest level of service. Our residences are built with the customer at heart, ensuring we provide the highest quality of amenities and services. Our understanding of the customers’ needs, and requirements makes the home buying process a simpler, less stressful experience,” he further explains.

 
Nationwide Properties concerns come at a time when URA says it poorly in
collecting some taxes like rental tax revenue in commercially managed properties.

President Yoweri Kaguta Museveni wants the Gross Domestic Product (GDP) tax to increase to stop donor dependence and loans. Uganda, at 18 percent, performs poorly in the GDP to tax ratio and can fund 45 percent of its budget.
Andrew recognizes the need for tax for economic development but appeals for delayed taxation in low-cost housing as a strategic plan for a wider tax base in future.
“This is one way to boost Build Uganda Buy Uganda (BUBU) that is steadily
progressing. I like BUBU as a phenomenon. We used to import wine from the United Kingdom and Italy, now such goods are now locally manufactured from here,” he said.