Museveni Sends Back Tax Bills, Citing Unfair Competition and Economic Concerns

President Yoweri Museveni has sent back the Income Tax (Amendment) Bill, 2026, and the Excise Duty (Amendment) Bill, 2026, to Parliament for further scrutiny. These bills, passed by the 11th Parliament prior to the new financial year, faced objections from the President regarding specific clauses.

Key among the President’s concerns is Clause 11 of the Income Tax (Amendment) Bill, which proposed a withholding tax on betting and gaming winnings. The bill included an exemption for winnings from land-based casinos, a provision President Museveni argued would create an uneven playing field and facilitate tax avoidance. He questioned the logic of applying different tax treatments to businesses engaged in similar economic activities.

Furthermore, the President objected to the significant increase in excise duty on single-use plastics outlined in the Excise Duty (Amendment) Bill. The proposed hike from 2.5% or US$70 per tonne to 25% or US$1,500 per tonne was deemed too steep. Museveni cautioned that such a drastic increase could negatively affect manufacturers, potentially impacting production, investment, and employment within the plastics sector.

He also highlighted that Uganda’s manufacturing sector is not yet adequately prepared to transition to alternative packaging materials, suggesting that viable alternatives are not readily available. The President recommended further study into the economic implications before implementing such a substantial environmental policy measure.

During the parliamentary session on July 14, 2026, Deputy Speaker Thomas Tayebwa addressed the President’s objections and procedural questions. He clarified that the President’s return of the bills was within the constitutional 30-day timeframe, refuting claims of undue delay.

The Parliament’s next steps will involve reconsidering the bills and addressing the President’s specific points of contention.