Published on 02/04/2025
Ugandan taxpayers will face higher financial demands in 2025/26 as the Uganda Revenue Authority (URA) sets a revenue target of UGX 36.71 trillion.
Minister of State for Finance, Henry Musasizi, confirmed the increase, signaling potential tax hikes. Citizens must brace for deeper contributions to meet the government’s growing budget needs. This represents an increase from the UGX 31.37 trillion projected for the current financial year (2024/25).
Musasizi made the revelation while appearing before Parliament’s Finance Committee today, where he led a URA team to present the Authority’s 2025/26 Ministerial Policy Statement. His remarks came in response to discrepancies in URA’s revenue projections, which appeared lower than those in the Appropriation Bill 2025.
Clarifying the figures, Musasizi stated: “The resource envelope presented by the Commissioner General is UGX 35.692 trillion, based on the second Budget Call Circular, before new tax measures were adopted. However, the new projection I presented in the House—UGX 36.71 trillion—accounts for the expected revenue after factoring in the proposed tax measures.”
Revenue Target Assumptions
Kira Municipality MP, Ibrahim Ssemujju, challenged URA to explain the basis for the increased revenue targets and whether the Authority is consulted in setting these projections. “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 questioned.
In response, Musasizi defended the projections, citing multiple factors, including economic growth estimates 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.
URA’s UGX 18.2 Billion Medical Expenses
During the meeting, MPs also scrutinized URA’s proposal to allocate UGX 18.2 billion for medical expenses in 2025/26. Kabula County MP, Enos Asiimwe, sought clarification on whether this amount covered medical insurance or was solely for medicine and medical supplies.
“Each department has an allocation for medical expenses, specifically for medicines and assorted items. Do we have in-house clinics, or is this part of an insurance scheme? The budget also includes UGX 18.2 billion for insurance services, so does this overlap with the medical expenses budget?” Asiimwe asked.
Five-Year Spending Commitments
URA Commissioner General, John Musinguzi, informed the committee that the Authority has been allocated UGX 764.40 billion for the 2025/26 financial year. Of this, UGX 400 billion is earmarked for wages, UGX 323.35 billion for non-wage expenditure, and UGX 40.79 billion for development.
He further disclosed that URA has multi-year spending commitments from 2025/26 to 2029/30 worth UGX 425.16 billion. These include:
- UGX 332.26 billion for IT equipment and related ICT items
- UGX 19.25 billion for office equipment and furniture
- UGX 72.65 billion for vehicles, motorcycles, and speedboats
The committee is expected to further scrutinize the proposed URA budget before making its recommendations to Parliament.
