By DAN ELWANA
in KAMPALA

Uganda yesterday unveiled a less austere budget with no major tax cuts, aimed at sustaining the gains realised in the last financial year, reduce poverty keep inflation low and address infrastructure problems.

Finance Minister Gerald Sendaula said government spending would go up by 21 per cent with priority spending on defence, education, health and infrastructure. Uganda expects total revenues of about Ush1,119 billion or about 12.5 per cent of the country's GDP.

However, there was no change in income tax rates, a move aimed at keeping macro-economic stability and inflation down. Mr Sendaula said tariff rates and trade liberalisation reforms that were due to take effect in July under the East African Co-operation has been postponed to facilitate wider consultations.

He said the government would spend Ush177 billion on defence as a means of achieving sustainable development. Other supplementary allocations were also made to the police force and the Prisons Department.

Uganda is also to lay emphasis on poverty eradication, with spending planned to increase from Ush83 billion in the past financial year to Ush154 billion. Some Ush48 billion would be spent on rehabilitation of roads with additional donor funds to the tune of $200 million.

Among the budget highlights were increases in public servants salaries for certain categories by five per cent and 10 per cent. However, a review of other categories of civil servants would be considered when funds become available, the Finance Minister promised.

The Finance Minister also announced a reduction in excise duty on soft drinks from 25 per cent to 20 per cent effective July, and another reduction in import duty on tourism-related vehicles from 15 per cent to seven per cent to boost tourism.

The minister also announced new measures governing taxes on airfreight goods, with a reduction of 30 per cent. Jet kerosene prices went down from nine dollar-cents per gallon to five dollar-cents.

However, Mr Sendaula said Uganda is to harmonise its fuel duty in line with the rest of the East African partner states.

He announced that all fuel stations would be required to display their retail prices on their boards and that the government would liberalise fuel importation. The Uganda Revenue Authority is to expedite the clearance of petroleum goods at the border points.

In Kenya, Finance Minister Francis Masakhalia read the Budget as police confronted crowds of people outside Parliament Buildings.

As the arrived in the House at 2.15 pm, MPs Mutua Katuku, Muthusi Kitonga and Newton Kulundu asked the police to desist from being used to fight the wishes of the masses.

"The Constitution belongs to the people and power stems from the people," said the three. They told the government that peoples' wishes would always prevail.

MPs Oloo Aringo, Anyang' Nyong'o and James Orengo shielded environmental activist Wangari Maathai from charging officers.

Nominated MP Tabitha Seei said a government that arms its people to suppress others did not deserve to rule.

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