Uganda is set to lose Ush182 billion ($64.1 million) of tax revenue through duty waivers on 80,000 tonnes of imported sugar, even though analysts say this move will not ease the shortage of the commodity in the country.

The EastAfrican has learnt that much of the imported sugar is being smuggled out to neighbouring countries due to lack of border controls.

Paul Kyeyune, the spokesman of the Uganda Revenue Authority, admitted that importation of duty-free sugar will leave a dent in the tax body’s revenue targets.

Going by figures from the Food and Agriculture Organisation, the current world sugar prices stand between $802 and $820 per tonne. This translates into at least $64.1 million in lost taxes for the 80,000 tonnes that Uganda is allowing duty free into the country.

Half of this figure has already been sanctioned by President Yoweri Museveni in an attempt to address the sugar crisis.

When Kampala was pleading its case for duty-free sugar imports before the EAC Council of Ministers in August, it was given the concession on condition that the sugar did not find its way into other EAC countries, according to Aston Kajara, Uganda’s Minister of State for Investment.

However, traders in Uganda are now re-exporting the imported duty-free sugar to South Sudan, officials of the local traders lobby admitted.