Ugandans are set to face a heavier tax burden as the Uganda Revenue Authority (URA) has been tasked with raising Shs36.71 trillion in the 2025/26 financial year. This marks a significant increase from the Shs31.369 trillion target for the current financial year (2024/25).
The announcement was made by Minister of State for Finance Henry Musasizi while appearing before Parliament’s Finance Committee. Musasizi led a team from URA to present the Authority’s Ministerial Policy Statement for the upcoming financial year.
Clarifying the figures, Musasizi stated, “The resource envelope as presented by the Commissioner General of Shs35.692Bn this is as per the second Budget Call Circular, before the new tax measures were adopted. The new projection which I presented in the House is Shs36.71Trn the one which came with the budget and this came after factoring in the projected revenue.”
The sharp rise in revenue collection targets raised concerns among lawmakers, with Kira Municipality MP Ibrahim Ssemujju questioning the rationale behind the projections and whether URA is actively involved in determining these figures.
“Are these targets determined by URA or simply imposed by Minister Musasizi? Every time the minister increases the budget, he also raises the revenue target. But in reality, we often collect less than projected. This has been a recurring issue over the years,” Ssemujju pointed out.
Defending the projections, Musasizi attributed them to multiple factors, including economic growth and improvements in tax administration.
“We assume there will be no decline in revenue compared to the previous year. The economy has been growing at an average rate of 6%, and new tax measures presented in Parliament are expected to generate additional resources. Moreover, as URA enhances efficiency in tax administration through staff recruitment, we anticipate further revenue growth,” Musasizi explained.
Meanwhile, scrutiny was also directed at URA’s proposed budget, particularly the allocation of Shs18.2 billion for medical expenses in 2025/26.
Kabula County MP Enos Asiimwe sought clarification on whether this budget covered medical insurance or was strictly for medicine procurement at URA offices.
“When you look at each department, they have an allocation of medical expenses for employees and specifically medicines and assorted items. Do we have in-house clinics or this is also part of insurance? On the second page, you can see insurance services budgeted at Shs18.2 billion. So, I was seeking clarification whether medical insurance is not part of the first budget of Shs18 billion,” Asiimwe remarked.
Responding to concerns, URA Commissioner General John Musinguzi revealed that the Authority has been allocated UGX 764.40 billion for the 2025/26 financial year. This includes UGX 400 billion for wages, UGX 323.35 billion for non-wage expenditures, and UGX 40.79 billion for development initiatives.
Additionally, Musinguzi disclosed that URA has multi-year spending commitments between 2025/26 and 2029/30 amounting to UGX 425.16 billion. These allocations include UGX 332.26 billion for IT equipment and ICT-related items, UGX 19.25 billion for office equipment and furniture, and UGX 72.65 billion for vehicles, motorcycles, and speedboats.
The Finance Committee is expected to further examine URA’s budget proposals before presenting its recommendations to Parliament.
