While some companies claim their poultry products are purchased locally, the meat is often imported and repackaged in Uganda, leading to loss of revenue to farmers, according to a report by New Vision.
Broiler farmer Kironde Lule said, "What we are experiencing now with the influx of cheap imported chicken is that they are undercutting us on price and putting us out of business."
Investigations revealed that between July 1 and December 3, 2011, a leading local company imported 725 tonnes of frozen chicken, New Vision said. This has resulted in Ugandan farmers losing sales revenue of UGX 5.7 billion (US$2,426,203) from one million birds.
There is also a further risk that the transit shipment, which has no tax liabilities, might have been sold in the country, the report said. Based on the entire consignment imported last year, it has been estimated that at least UGX 1 billion (US$404,041) could have been lost in underpayment of taxes.
According to Uganda Revenue Authority (URA), the total taxes paid last year for poultry imports was UGX 215 million (US$86,939), but industry experts claimed the amount was less than the expected value.
In the 2005/06, Uganda passed the Animal Diseases Act that stopped the import of any meat products into the country to guard against the risk of Highly Pathogenic Avian Influenza (HPAI).
The governement ban has now been partially lifted the ban to allow imports from countries without outbreak of the disease.
"It is very unfortunate that this has been allowed to happen because it is a risk to the food security of the country. If the imports continue, they may wipe out our industry," stated Poultry Association of Uganda acting chairman Aga Sekalala.
Calling for a higher tax on poultry imports, Sekalala said, "We appeal to the government to reaffirm the policy and ensure long term development of the poultry industry. The imports had already caused a slowdown in the regular growth of the poultry sector."