Tax experts have hailed Uganda’s shs72.37 trillion budget for the 2025/26 financial year as a progressive step towards wealth creation.
These have cautioned that the budget’s success will depend on how well the government ensures that ordinary citizens can access and benefit from the initiatives outlined.
Speaking during the post-budget dialogue hosted by Ernst & Young at the Sheraton Hotel in Kampala on Friday, Hamza Ssali Mukasa, Senior Manager in the EY tax department, noted that while the budget has “so many opportunities,” implementation and information gaps remain the biggest risks.
“This year’s budget has so many opportunities, but it will depend on how the government disperses these funds to the lowest end users. You look at PDM with over a trillion shillings, agricultural credit at shs140 billion, and the recapitalization of UDB with over a trillion—all these create opportunities for wealth creators,” he said.
Mukasa emphasized the need to reorient funding models like the Parish Development Model (PDM) from consumption-based to production-driven in order to create sustainable economic growth.
“The PDM model as it stands is more of a consumption model focused on household welfare. For real growth, we need models that stimulate production factories, agro-processing hubs something that creates jobs and grows tax revenue.”
He also called for improved transparency and simplicity in how government funds can be accessed.
“Businesses struggle to access UDB funding because the process isn’t clear. A trader or farmer in the village should know, step by step, how to apply and benefit,” Mukasa added.
Robert Mbaziira the Senior Tax Manager at Ernst & Young, commended the government’s move to expand the tax base by making Tax Identification Numbers (TINs) mandatory for all Ugandans effective July 1, 2025. He called it a “bold, deliberate move” to formalize the economy.
“Even if you’re deep in the village, you will now be on the tax register,” Mbaziira said. “But there’s a catch, 33% of Ugandans are not in the money economy. So yes, they’ll be on the register, but they won’t contribute much to the revenue basket.”
He warned that while this policy increases inclusion, it may also overload the tax system with inactive taxpayers unless proper targeting is done.
Mbaziira also welcomed the budget amendment exempting newly registered businesses (with capital below UGX 500 million) from taxes for their first three years, effective July 1, 2025.
“This is critical. Most Ugandan businesses don’t live to see their third or fifth birthday. Government is now trying to grow the chick before it can lay golden eggs,” he noted.
Additionally, he praised the “green” tax measures that promote the use of alternative energy sources such as biomass and solar in rural areas particularly for their potential impact on education and household welfare.
“Biomass like banana peelings or coffee husks can help light homes in villages, allowing children to study at night. This is not just energy policy, it’s socio-economic development,” he added.
Experts agreed that Uganda’s 2025/26 budget sets a strong foundation for economic transformation especially under the theme “Full Monetization of the Economy Through Commercial Agriculture.” But they stressed that the opportunity lies not just in allocation but in awareness, access, and execution.
“The money is there, but people must be aware that these opportunities exist,” Mbaziira emphasized. “Often, the funds remain unused simply because citizens don’t know how to access them.”
