Government has proposed new taxes on fuel, cement, and essential household commodities in a move that could increase the cost of living, as Henry Musasizi tabled a series of tax bills before Parliament of Uganda.
The proposals are contained in the Excise Duty (Amendment) Bill, 2026, which was presented alongside six other bills for scrutiny.
Under the proposed changes, government plans to introduce a tax of Shs1,000 on every 50kg of cement, including adhesives, grout, white cement, and lime—raising concerns about potential increases in construction costs.
The bill also proposes a Shs200 increase in fuel taxes, pushing the levy on petrol (motor spirit) to Shs1,750 per litre and diesel (automotive gas oil) to Shs1,430 per litre. Analysts say the adjustment is likely to trigger a rise in transport fares and commodity prices.
In addition, government is seeking to impose a tax of Shs400 per litre on cooking oil and Shs500 per litre or kilogram of cooking fat, a move expected to affect household expenditure.
The proposals further include a registration fee of Shs500,000 on every motorcycle at first registration, a measure that could impact the cost of acquiring boda bodas.
Under the bill, locally manufactured paints, varnishes, and lacquers would attract a tax of either 3 percent or Shs50 per litre or kilogram, whichever is higher, while imported products would be taxed at either 10 percent or Shs2,000 per litre or kilogram.
The Ministry of Finance is also proposing the introduction of a withholding tax on public entertainers. If passed, event organizers will be required to deduct tax from gross payments in line with provisions under the Income Tax (Amendment) Bill.
Additionally, an environmental levy of 30 percent has been proposed on worn clothing and other used articles under the External Trade (Amendment) Bill, a move aimed at protecting local industries and addressing environmental concerns.
The Speaker of Parliament, Anita Among, has since referred the bills to Parliament’s Finance Committee for detailed scrutiny.
Background & Outlook
The proposed tax measures come as government seeks to increase domestic revenue to finance its budget priorities. However, the new levies are likely to spark debate among lawmakers and the public, particularly over their potential impact on the cost of living and key sectors such as transport and construction.
The Finance Committee is expected to review the proposals and present its report before the bills are debated and either passed or amended by Parliament.
