UFZA tips manufactures on the incentive opportunities in free zones for high value, cost effective exports.
Drake Nyamugabwa
Uganda Free Zones Authority (UFZA) has called upon manufactures to join the existing free zones in Uganda to benefit from the various business opportunities that comes along with operating there.
The manufactured have particularly told to leverage on the incentives like import duties, the facilities among others.
During the sensitisation workshop for manufactures in the benefits and opportunities under the free zones held at Imperial Royale hotel on Thursday 21st July 2022, the Director, Business Development and Investor Support at UFZA, Rebecca Nalumu said that the authority is committed in supporting manufactures to seize market opportunities in the regional and globally.
The Director in above picture, said that the free zones are promoting exports manufacturing for developers and operator that operated there.
She added that with the collaboration with Uganda Manufactures Association (UMA), bring attract manufactures in the frees zone to invest and develop business for export.
“Free zones schemes are attracting various manufacturing in different products to promote export oriented industries. We shall intensify our collaboration with UMA through an MOU to lobby, ensure manufactures seize the opportunities in free zones to grow export” she said
The Director explained that free zones areas within a country where licensed manufacturers and or trader’s imported goods can be stored or processed without being subjected to import or export duty suited in customs areas within the country and where 80% of what is produced in the Free Zone is for exports.
The Head, Policy and Advocacy at UMA, Muhammed Muzamir pictured above, rallied manufactures to embrace free zones in avid to enjoy the incentives which he said provide a comprehensive package of incentives for holders of Free Zone Developer, Operator or Manager Licenses which include: exemption from taxes and duties on all export processing imported raw materials and intermediate goods, machinery and equipment, spare parts, for exclusive use in the development and production of output for the business enterprise.
“The incentives in free zones will allow investors to produce and or, process large quantities and better quality goods at a relatively competitive lower cost for the export market” he said
Muzamir said that UMA will support the Parish Development Model through a backward integration to access the raw materials to develop the industries for export promotion.
In addition, according to UFZA, the Free Zone are providing unrestricted remittance of profit after tax, tax holiday for 10 years on finished consumer and capital goods, 100% exemption from tax on income from agro-processing, 100% exemption on income derived from the operation of aircrafts in domestic and international traffic or the leasing of aircraft, exemption on plant and machinery used in the free zones for 5 years and 1 day from Customs duty upon disposal, exemption from all taxes, levies and rates on exports from the free zones namely excise duty and Customs taxes; 100% exemption from tax on income of a person offering Technical Assistance under a Technical Assistance Agreement; Exemption from import duties and taxes on all goods entering a free port zone; VAT exemption on supply of selected services e.g. medical services, social welfare services, power generated by solar; Exemption of Withholding Tax on petroleum, petroleum products, plant and machinery, human or animal drugs and supply/importation of raw materials.
In the process, this will promote export growth and diversification by creating forward and backward linkages, enhance technology transfer and skills development, accelerate economic growth, facilitate job creation, as well as boost investment to mention but a few.
Uganda Free Zones Authority (UFZA) was created by an Act of Parliament in 2014 and started operations on September of that year. The Authority is mandated to oversee the establishment, development, management, marketing, maintenance, supervision and control of Free Zones in Uganda.
