Uganda’s traders, under the Kampala City Traders Association, have asked government to revise key proposals in the Tax Amendment Bills for the Financial Year 2026/2027, warning that the measures could increase the cost of doing business and slow economic recovery.
The traders argue that some of the proposed tax changes, if implemented without adjustment, could place additional pressure on enterprises already recovering from recent economic challenges, potentially pushing more businesses into informality.
KACITA chairman Isa Sekitto said the association is not opposed to taxation but emphasised the need for policies that support growth and sustainability.
“We are not opposed to taxation, but it must be fair and growth-oriented. Reducing VAT to 16 per cent and raising the threshold to Shs1 billion will ease pressure on businesses and improve competitiveness,” Sekitto said.
Among the key proposals from traders is a reduction in Value Added Tax (VAT) from 18 per cent to 16 per cent, an increase in the VAT registration threshold to Shs1 billion, and a review of import duties on textiles, which they say are higher than regional standards.
Business leaders say aligning tax policies with regional frameworks would improve Uganda’s competitiveness within the East African market and support the growth of small and medium enterprises.
They warned that failure to revise the proposals could lead to reduced compliance, increased operational costs, and slower growth across the private sector, ultimately affecting the country’s broader economic outlook.