14/04/2026
📢 TJAU Position on FY 2026/27 Tax Amendment Bills: A Call for Fair and Balanced Tax Reform in Uganda:
Earlier today, the Tax Justice Alliance Uganda (TJAU), convened by SEATINI, presented its position before the Parliamentary Committee on Finance, Planning and Economic Development on the FY 2026/27 Tax Amendment Bills.
Whereas we recognise Government’s efforts to mobilise approximately UGX 4.8 trillion in additional domestic revenue, we strongly emphasise that Uganda’s tax reforms must be anchored in the 4Rs of taxation including Revenue, Redistribution, Representation, and Repricing to ensure fairness, equity, and long-term sustainability. While we support efforts to broaden the tax base and strengthen tax administration, we caution against over-reliance on consumption-based taxes that risk increasing the cost of living and deepening inequality. A fair tax system must prioritise expanding untapped revenue sources and improving compliance in under-taxed sectors.
TJAU supports several targeted amendments aimed at strengthening compliance, closing loopholes, and enhancing fairness in the tax system, including proposals under the Excise Duty (Amendment) Bill 2026 such as increasing excise duty on un-denatured spirits from UGX 1,700 to UGX 3,500 per litre, increasing excise duty on motorcycles at first registration from UGX 200,000 to UGX 500,000, and extending excise duty to cooking fat and trans-fatty acids like margarine to support public health and broaden the tax base.
Under the Income Tax (Amendment) Bill 2026, we support measures such as introducing a minimum tax of 0.5% on gross income after 7 years of continuous losses to reduce abuse of loss carry-forwards, strengthening measures against thin capitalization and base erosion through improved withholding tax rules on interest payments, broadening the definition of “royalty” to include software to capture the digital economy more effectively, introducing taxation on non-business asset disposals to improve progressivity and widen the tax base, strengthening transfer pricing rules to curb profit shifting, introducing withholding tax mechanisms on telecom commissions, mobile money services, betting winnings, and public entertainer payments to improve compliance in the informal economy, and extending taxation to foreign-sourced income for resident individuals to promote equity and fairness in taxation.
We also support rationalisation of tax expenditures, stronger monitoring of incentives, and alignment with Uganda’s NDP IV and the Ten-Fold Growth Strategy to ensure value for money and development impact.
While we support these revenue-enhancing reforms, we caution that over-reliance on excise taxes may increase the cost of essential goods and services, that fair taxation requires broadening the tax base rather than overburdening compliant taxpayers, and that greater attention must be given to taxing under-taxed sectors including the digital economy and informal sector. We also emphasise that tax incentives must be transparent, regularly reviewed, and aligned with national development priorities.
A comprehensive analysis covering all the proposed tax amendment bills will be availed in due course.
TJAU remains committed to advancing a fair, equitable, and sustainable tax system in Uganda. Tax reform must not only raise revenue but also strengthen trust, promote fairness, and support inclusive development. A just tax system is the foundation of a strong social contract.
