Parliament has passed the Hides and Skins Export Duty (Amendment) Bill, 2025, introducing a uniform export levy of US$0.80 per kilogram on all hide and skin products, including previously exempt glue stock and semi-processed materials, as part of a broader strategy to enhance value addition, protect domestic industries, and align with international trade standards.
The move comes amid growing concerns over the unchecked export of glue stock, offcuts and scraps from processed hides often repurposed into food products like ponmo for West African markets, which lawmakers say has drained raw material supplies from local tanneries, undermining Uganda’s leather processing sector.
Chairperson of the Finance Committee, Amos Kankunda, said the amendment seeks to reverse this trend by increasing the availability of hides and skins for domestic value addition.
Kankunda who was presenting a committee report, stressed that the removal of exemptions will enhance raw material availability for Uganda’s tannery industry and support our ambitions for industrialisation.
The reclassification and taxation of glue stock triggered intense debate in Parliament, with some legislators urging caution, citing the need to promote innovation and export diversification. Others, however, argued that exporters were exploiting loopholes by misclassifying hides as food to avoid taxation.
“We cannot say someone is exporting hides when they have cooked and packaged them as food. The Uganda Revenue Authority (URA) must ensure proper classification,” said Dicksons Kateshumbwa (NRM, Sheema Municipality).
Attorney General Kiryowa Kiwanuka clarified that food exports fall outside the purview of the law.
However, if URA continues to classify glue stock as a hide-based export, it must attract the levy like any other raw or semi-processed skin.
The amendment aligns with Uganda’s push to standardise its export regime and develop local industries by encouraging processing and manufacturing within the country, rather than exporting raw materials.
This shift reflects a growing consensus among policymakers that Uganda must retain and refine its natural resources to compete in global markets and comply with international trade practices.
Stamp Duty Waived on Agreements to Spur Credit Access
In a related development, Parliament also passed the Stamp Duty (Amendment) Bill, 2025, scrapping the longstanding Shs15,000 duty on agreements and mortgage deeds.
The reform introduces a “near-duty” classification aimed at easing contract registration and reducing the cost of borrowing.
Minister of State for Finance (General Duties), Henry Musasizi, explained that the bill targets credit-related instruments that have long discouraged private sector growth due to excessive fees.
He said this reform supports access to affordable credit and promotes business development.
Attorney General Kiwanuka added that the bill resolves previous ambiguities where stamp duty was incorrectly applied even to employment contracts. “
“The issue was to remove the duty on any of those registrable memorandum… now you can have your agreement without duty,” he said.
