Parliament has approved tax waivers worth over Shs9.5 billion for selected local investors in the 2024/2025 financial year. This decision followed the adoption of the report from the Committee on Finance, Planning, and Economic Development.
Presenting the report on Thursday, February 20, 2025, Committee Chairperson Amos Kankunda outlined the tax liabilities of various universities and private businesses that had applied for waivers. The exemptions were granted under Section 40(1) of the Tax Procedures Code Act, 2014, based on financial hardships and the strategic importance of the entities to Uganda’s economic development.
The Minister of State for Finance (General Duties), Henry Musasizi, who moved the motion, affirmed that all organisations granted waivers had undergone thorough vetting and met the necessary qualifications.
However, Kankunda cautioned that Uganda continues to lose substantial revenue through tax exemptions, citing a revenue loss of Shs2.9 trillion in tax expenditures in the last financial year alone, representing 12.5% of the total revenue collected.
Among the beneficiaries, J2E Investment Corporation Ltd received a waiver of Shs2.7 billion in unpaid Value Added Tax (VAT) due to government delays in settling payments for construction projects. M/S Nicontra Ltd, a road construction company, was granted Shs931 million in tax relief due to Uganda Revenue Authority (URA)’s payment allocation rules affecting its arrears.
Nkumba University was granted Shs4.4 billion in response to declining student enrolment and a drop in tuition revenue. Busoga University received Shs783 million following the government’s decision to take over the institution.
Makerere Business Institute, which struggled with tax compliance due to the economic impact of the COVID-19 pandemic, was granted Shs239 million. Kisiizi Hospital Power Ltd was allocated Shs77 million to support its role in supplying affordable electricity to rural communities.
Speaker Anita Among urged Members of Parliament to educate their constituents on the benefits and opportunities available to them through such waivers. Kampala Central MP, Muhammad Nsereko, suggested the need for broader consideration of small and medium-sized businesses, including the removal of penalties that negatively impact economic growth.
Kankunda added that any struggling businesses or institutions seeking a waiver can apply through the Uganda Revenue Authority.
