Parliament has approved tax waivers amounting to over Shs9.5 billion for various local investors in the 2024/2025 financial year. This follows the adoption of a report by the Committee on Finance, Planning, and Economic Development, which assessed applications from institutions facing financial challenges.
Presenting the report on Thursday, 20 February 2025, Committee Chairperson Hon. Amos Kankunda outlined the tax liabilities of private businesses and universities seeking relief. The exemptions were granted under Section 40(1) of the Tax Procedures Code Act, 2014, which allows for waivers in cases of financial hardship or strategic economic importance.
The Minister of State for Finance (General Duties), Hon. Henry Musasizi, who moved the motion, assured the House that all entities receiving waivers had been thoroughly vetted and met the necessary criteria. However, Kankunda raised concerns about the long-term impact of tax exemptions, noting that Uganda had foregone Shs2.9 trillion in tax expenditures in the previous financial year, representing 12.5% of total revenue collected.
The approved tax waivers include:
Shs2.7 billion for J2E Investment Corporation Ltd, a construction company burdened by unpaid VAT due to government delays in settling project payments.
Shs931 million for M/S Nicontra Ltd, a road construction firm affected by Uganda Revenue Authority (URA)’s tax allocation rules.
Shs4.4 billion for Nkumba University, which has struggled with declining student enrollment and reduced tuition revenue.
Shs783 million for Busoga University, following the government’s decision to take over the institution.
Shs239 million for Makerere Business Institute, which faced tax compliance challenges due to the COVID-19 pandemic.
Shs77 million for Kisiizi Hospital Power Ltd, to support its role in providing affordable electricity to rural communities.
During the debate, Hon. Asuman Basalirwa (JEEMA, Bugiri Municipality) questioned the transparency of the selection process, raising concerns about whether such opportunities were widely accessible. “How does an ordinary business owner or farmer in remote areas know about these waivers?” he asked.
Speaker Anita Among responded by emphasizing that Members of Parliament have a responsibility to inform their constituents about available government programs and benefits.
Kampala Central MP, Hon. Muhammad Nsereko, suggested expanding tax relief measures to include small and medium enterprises (SMEs), particularly by waiving penalties that stifle economic growth.
Kankunda clarified that businesses or individuals seeking tax relief could apply directly through the Uganda Revenue Authority.