Uganda seeks ‘political fix’ over new South Sudan’s e-tax

2026-03-03 - 08:57

Uganda’s lucrative export corridor to South Sudan is facing renewed turbulence following the introduction of a new electronic permit levy by the government of South Sudan. The move has effectively choked traffic at the Nimule border and rattled Kampala’s trade officials. By last week, at least 1,000 trucks were stranded at Nimule, the main gateway for Uganda’s exports to South Sudan. When officials from the ministry of East African Community (EAC) Affairs appeared before parliament’s public accounts committee (PAC) last Thursday, what was meant to be scrutiny of the Auditor General’s 2024/2025 report quickly morphed into an urgent interrogation over what MPs described as a “trade emergency.” Officials characterised the situation as a “serious disruption” to cross-border commerce. At the centre of the standoff is a newly introduced e-permit levy requiring payment for each truck or container entering South Sudan from Uganda. According to the ministry, the charge ranges between $500 and $1,000 per truck, a cost they say is both excessive and destabilising. “You find one truck, one container, is expected to pay between $500 and $1,000. The payment is excessive,” said Leo Kizito Ojara, commissioner for economic affairs at the EAC ministry. The levy has brought exports to Juba to a near standstill, officials said, driving up prices in South Sudan’s capital and disrupting supply chains in Uganda’s largest regional market. For years, South Sudan has ranked among Uganda’s top export destinations, absorbing foodstuffs, construction materials, manufactured goods and fuel. The Nimule crossing is a critical artery in that trade. Any prolonged blockage, analysts warn, risks eroding export earnings, unsettling transport and logistics networks, and deepening inflationary pressures in Juba. Ojara told MPs that the price of sugar in Juba had already surged to between Shs 10,000 and Shs 15,000 per kilogramme, attributing the spike to shortages linked to the stranded trucks. “There is a big problem at the border as supplies to Juba are in shortage,” he said, urging high-level diplomatic engagement. “In my view, we need a political solution. How quickly can you involve the Head of State in this matter? He should talk to his counterpart across the border.” Permanent secretary Edith Mwanje echoed the alarm, warning that trade flows had slowed dramatically since the levy took effect. “We’re deeply concerned about the impact on trade and the economy, the tax is crippling trade and pushing up prices of essential goods in Juba,” she said. PAC chairperson Gorreth Namugga framed the issue as more than a bilateral trade dispute, arguing that the levy undermines the spirit of the EAC Common Market Protocol, which guarantees the free movement of goods and services among partner states. “This is a serious issue affecting our trade and economy,” Namugga said. She faulted the ministry for failing to promptly alert exporters to the unfolding crisis, noting that some traders were still dispatching trucks to Nimule, unaware of the standoff and therefore exposing themselves to avoidable losses. “Some trucks are stuck at the border, but others may still be packing items to go there. In such circumstances, how do we communicate so that we help people to avoid losses?” she asked. The Auditor General’s report had already flagged weaknesses in the ministry’s communication and visibility of services — concerns that, according to Namugga, appear unresolved. Elijah Okupa (Kasilo County) pressed for swift intervention, especially for traders dealing in perishable goods vulnerable to spoilage during prolonged delays. The impasse comes at a delicate moment for regional integration. The committee also discussed delayed subscription payments by partner states to the EAC and ongoing consultations on the draft EAC Political Confederation Constitution, widely viewed as a stepping stone toward deeper federation. Under the EAC Treaty and the Common Market Protocol, partner states are obligated to eliminate non-tariff barriers and facilitate seamless trade. A unilateral levy that significantly raises the cost of entry could be classified as such a barrier, potentially triggering formal dispute resolution within the bloc. Trade experts caution that persistent disruptions at strategic crossings like Nimule risk eroding business confidence and weakening momentum toward a political confederation. Citing the Auditor General’s findings, Namugga delivered a stinging rebuke to ministry officials. “When you look through the Auditor’s report, it implicates you; it shows as if you are doing a lot of nothing,” she charged. “This is unacceptable. I want to express our disappointment and displeasure in the way you have appeared today!”