Parliament has passed the Value Added Tax Amendment Bill, 2026, adopting a series of reforms aimed at easing compliance for small businesses, improving tax administration, and attracting investment, following a report presented by Mbale Industrial Division MP Karim Masaba.

The House approved the Bill with amendments after scrutiny by the committee, which argued that the changes would modernise the VAT system while addressing long standing concerns from taxpayers and the private sector.

At the centre of the reforms is the increase in the VAT registration threshold from Shs150 million to Shs250 million, a move lawmakers say will reduce the compliance burden on small and medium enterprises.

“The increase in the VAT threshold will shift focus of tax administration to higher earning businesses, making it easier for the Uganda Revenue Authority to administer VAT,” the committee report states.

Legislators noted that many businesses within the current threshold contribute only a small share of total VAT collections but face high compliance costs, including filing monthly returns and maintaining accounting systems.

The Bill also removes VAT withholding where a taxpayer issues an electronic invoice or receipt, allowing suppliers to receive the full 18 percent VAT and easing cash flow constraints.

“With the proposed amendment, a supplier will now have the full 18 percent VAT, thereby addressing the prevailing cash flow challenges,” the report notes.

However, debate on the floor revealed concerns over key provisions, particularly the treatment of software under the proposed amendments.

Kira Municipality MP Muhammad Nsereko raised reservations over the proposal to impose VAT on software, warning that it could undermine Uganda’s digital transformation agenda.

“I have a huge passion for technology,” Nsereko told the House, describing it as an equaliser for unemployed but innovative young people and a driver of growth in emerging economies.

He argued that software is central to innovation and cautioned against policies that could slow technological progress.

“Software infrastructure is central to innovation. Without it, progress in technology and digital transformation would be limited,” he said.

Nsereko further noted that software is already embedded in critical systems across the economy, including government platforms such as electronic receipting systems, warning that taxing it could affect service delivery.

“Software is embedded in everyday systems across the economy, including government platforms like EFRIS,” he added.

Concerns were also raised over the broader VAT framework, with Erute South MP Jonathan Odur questioning both the tax rate and structural changes proposed in the Bill.

Odur noted that Uganda’s VAT rate of 18 percent remains higher than in some East African countries and said government had not presented sufficient justification for maintaining it.

“Some countries in the region apply lower rates including 16 percent and even 8 percent, but no report has been presented to guide this House,” he said.

He also questioned the rationale for raising the VAT registration threshold and criticised provisions that create different conditions for citizens and foreign investors in accessing tax credits.

“Amounts equivalent to millions of dollars are far beyond the reach of most Ugandan citizens. These are not easy conditions for an ordinary person investing in this country to meet,” Odur argued.

Despite the concerns, Parliament adopted the committee recommendations, including expanded tax credits for developers of hotels and tourism facilities, aimed at lowering investment costs and boosting the sector.

Lawmakers said the changes will allow investors to recover more VAT on construction inputs, making large scale projects more viable.

“This change ensures that VAT does not become an extra cost to a VAT registered business, reducing the overall cost of building hotels and making Uganda more attractive to investors,” the committee observed.

The Bill also introduces incentives to promote electronic receipting by lowering the threshold for VAT refunds to non-registered taxpayers from Shs5 million to Shs2 million within 30 days.

“This amendment is intended to encourage the use of electronic fiscal receipting and invoicing and improve transparency in tax collection,” the report states.

Other provisions include revising rules on interest for delayed VAT refunds, granting the Finance Minister powers to determine tax payment timelines for the mining sector and extending tax exemptions to selected international organisations.

The committee drew input from a wide range of stakeholders including the Ministry of Finance, the Uganda Revenue Authority, the Private Sector Foundation Uganda and the Uganda Manufacturers Association among others.

The Bill, which is expected to generate an additional Shs353 billion annually, was passed after Parliament considered it clause by clause in the Committee of the Whole House.

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The Office of the Prime Minister has warned local government officials over the illegal practice of forcing beneficiaries to sign cattle restocking declaration forms before receiving funds, saying the move undermines accountability and exposes citizens to fraud.

In a clarification issued on April 8, 2026, the Office said it had received credible reports from the Acholi, Lango, and Teso sub-regions where some officials are demanding pre-signed forms from beneficiaries under the ongoing cattle restocking programme.

“Beneficiaries are required to sign declaration forms acknowledging receipt of funds before any payment is made. This practice is a direct violation of the approved Programme Implementation Guidelines and is firmly condemned,” the statement said.

The cattle restocking programme stems from a presidential directive aimed at rebuilding household incomes in northern and eastern Uganda. It was operationalised under Cabinet Minute 46 of 2025, with the government approving funding for thousands of households across the three sub-regions.

According to the Office of the Prime Minister, 11,023 beneficiaries were cleared to benefit from the programme during the 2025 to 2026 financial year, each receiving Shs5 million to procure five animals, including heifers and bulls.

The funds, the government clarified, are not handled in cash by officials but are directly transferred to verified beneficiaries through bank accounts or registered mobile money platforms after due verification.

“Verified beneficiary lists are submitted to OPM through the Ministry of Local Government. OPM then disburses funds directly to each beneficiary’s bank account or registered mobile money number,” the statement explained.

The Office emphasized that the declaration form is strictly meant to confirm receipt of funds and must only be signed after the full Shs5 million has been received by the beneficiary.

“Pre-signing of receipt declarations creates a risk of false financial accountability, exposes vulnerable beneficiaries to fraud, and is an abuse of trust by those mandated to implement this programme,” the statement added.

Under the approved process, beneficiaries are first identified and vetted by district technical teams at parish level before lists are consolidated and submitted through the Ministry of Local Government for final verification and payment.

Authorities now warn that any deviation from these procedures not only violates programme guidelines but also threatens the integrity of a project designed to uplift vulnerable communities.

Beneficiaries have been advised not to sign any document confirming receipt of funds they have not received and to report any such demands to district authorities or directly to the Office of the Prime Minister.

“Any official requesting a pre signed declaration should be reported immediately to the relevant District authorities or directly to the Office of the Prime Minister,” the statement urged.

The government reiterated its commitment to ensuring that all funds reach the intended beneficiaries in full, stressing that the cattle restocking programme will be implemented under strict standards of transparency and accountability.

“The Government of Uganda remains firmly committed to ensuring that all programme funds reach intended beneficiaries in full and that the Cattle Restocking Programme is implemented with the highest standards of transparency, accountability and integrity,” the statement noted.

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The Ruparelia Foundation will in May conduct a free medical outreach at Mulago National Referral Hospital where hundreds of amputees are expected to receive prosthetic limbs in an effort to restore mobility and improve livelihoods.

The planned camp builds on the Foundation’s growing humanitarian work across the country, targeting vulnerable populations who often lack access to specialised and affordable medical care.

The three-day camp will commence on 1st May 1-3, in memory of tycoon Sudhir Ruparelia’s late son, Rajiv Ruparelia, for his vision of service and legacy of compassion.

The Mulago initiative will focus on identifying, fitting and supporting amputees with appropriate prosthetic limbs, offering many a chance to regain independence after years of limited movement.

This intervention is expected to change lives by enabling beneficiaries to move, work and participate more fully in their communities.

The development follows the Foundation’s recent eye care camp in Bukedea District, where hundreds of patients received free treatment, including cataract surgeries and other vision-related services. 

Medical teams at the camp reported a strong turnout, with many patients regaining their sight after years of visual impairment.

Health workers involved in the Bukedea outreach described the exercise as successful, noting that it not only addressed immediate medical needs but also reduced the burden on families who had long struggled to access such services.

Encouraged by the outcome, the Foundation is now extending its interventions beyond eye care to include mobility support, reflecting a broader approach to improving quality of life among underserved communities.

The additional medical camps and specialised treatment programmes are being planned for later in the year, with a focus on reaching more remote and disadvantaged areas.

For now, attention turns to Mulago this May, where the prosthetic limb fitting exercise is expected to restore dignity, independence, and hope to hundreds of amputees.

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The Budget Committee has summoned officials from the Ministry of Science, Technology and Innovation to explain why Shs46 billion allocated for innovation has remained unutilised for two consecutive financial years.

The move follows findings by the Parliamentary Committee on Presidential Affairs, which revealed that despite the government releasing the funds in the 2024/2025 financial year, the money remains idle in accounts held by the Uganda Development Bank.

According to the report, the funds were earmarked to support innovation projects, including research into anti-tick solutions considered critical in addressing tick-borne diseases affecting Uganda’s livestock sector.

However, by the time of the committee’s assessment, no funds had been disbursed to the intended beneficiaries.

“The committee observes the burden of tick-borne diseases in Uganda and the need for homegrown solutions to enable import substitution. But by the time of this report, no money had been received by the intended grantees,” said Alex Byarugaba, Chairperson of the Committee on Presidential Affairs, while presenting the report to the Budget Committee.

The report further indicates that Shs 25 billion in grants intended for anti tick research developers has remained unutilised for two years, raising alarm among legislators about inefficiencies within the ministry and delays in implementing key government priorities.

Members of Parliament expressed frustration over the continued inactivity of the funds, questioning accountability mechanisms and oversight within the ministry.

The Chairperson of the Budget Committee, Patrick Isiagi Opolot, described the situation as unacceptable and indicative of possible abuse of office.

“To say that money was received and never utilised amounts to abuse of office. Who is the accounting officer who receives funds for two years and sits on them?” he asked.

He also faulted the Committee on Presidential Affairs for not escalating the matter earlier to Parliament for decisive action.

Legislators called for stricter measures, including halting further funding to the ministry until accountability is ensured.

The committee has now directed officials from the science ministry to appear within a week to explain the continued non utilisation of the funds, warning that failure to justify the idle money could result in denial of future budget allocations.

However, Stephen Baka Mugabi, Chairperson of the Parliamentary Committee on Legal and Parliamentary Affairs, cautioned that the Budget Committee’s mandate is limited during the appropriation stage and advised that the matter be referred to the full House for comprehensive investigation and action.

The Budget Committee is currently scrutinising sectoral committee reports on ministerial budget projections for the 2026/2027 financial year.

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