Uganda gambling tax bills returned by President Museveni
Uganda’s proposed gambling tax reforms have been delayed after President Yoweri Museveni declined to assent to the Income Tax (Amendment) Bill, 2026 and the Excise Duty (Amendment) Bill, 2026, returning both to Parliament for reconsideration over concerns that some of the proposed tax measures would create unfair competition, encourage tax avoidance and negatively affect the economy.
The two bills were considered and passed by the 11th Parliament in April 2026 ahead of the reading of the 2026/27 national budget and the start of the new financial year in July 2026.
During the House sitting on 14 July 2026, Deputy Speaker Thomas Tayebwa informed legislators that President Museveni had objected to specific clauses in both bills, particularly provisions relating to withholding tax on betting winnings and the proposed increase in excise duty on single-use plastics.
“The President is against the passing into law of Clause 11 of the Income Tax (Amendment) Bill, 2026,” Tayebwa said while communicating the President’s message to the House.
Betting tax clause draws presidential objection
At the centre of the President’s concerns is Clause 11 of the Income Tax (Amendment) Bill, 2026, which sought to introduce a withholding tax on winnings from betting and gaming activities.
However, the clause included an exemption for winnings earned from land-based casinos licensed under the Lotteries and Gaming Act, 2016.
Museveni argued that exempting one category of gaming operators while taxing another undertaking similar activities would create an uneven playing field and open opportunities for tax avoidance.
In his communication to Parliament, the President warned that exempting land-based casinos from withholding tax could encourage businesses to restructure their operations in ways designed to minimise their tax liabilities.
“The exemption creates opportunities for tax avoidance and revenue leakage,” Museveni said.
He also questioned why businesses engaged in substantially similar economic activities should be subject to different tax treatment. “There is no justification for exempting one category while taxing the other,” he argued.
The proposed withholding tax would have increased the tax burden on players by taxing winnings from betting and gaming activities, while maintaining an exemption for winnings obtained from licensed land-based casinos.
Wider gambling tax reforms remain in focus
The returned legislation comes against the backdrop of Uganda’s broader gambling tax reforms. Finance Minister Matia Kasaija had earlier presented the Lotteries and Gaming (Amendment) Act, 2026 to Parliament. If implemented, the legislation would align tax on betting gross gaming revenue (GGR) with the 30 per cent gross gaming revenue tax already applied to casinos.
Had the proposed tax structure been approved, Uganda would have been among the jurisdictions with the highest gambling tax rates in the region.
The President’s decision to return the bills means the proposed tax framework will now require further parliamentary consideration before any changes can take effect.
Plastic tax proposal also rejected
President Museveni also challenged the proposed increase in excise duty on single-use plastics in the Excise Duty (Amendment) Bill, 2026. Parliament had approved raising the duty from 2.5 per cent or US$70 per tonne to 25 per cent or US$1,500 per tonne, whichever is higher. He said the increase was too substantial and recommended further study before it is implemented.
Parliament debates legislative procedure
MPs also discussed whether the returned bills should be reconsidered by the current Parliament or reintroduced through a fresh legislative process.
Bbale County MP Charles Tebandeke questioned whether the bills should be reintroduced because they had originally been considered and passed by the dissolved 11th Parliament.
“The law assumes that the 11th Parliament that was handling these Bills was dissolved and the matter was overtaken by events,” Tebandeke said.
Deputy Speaker Tayebwa rejected the suggestion that the President had acted outside the constitutional timeframe for returning the legislation.
He reminded legislators that the Constitution requires the President to either assent to a bill or return it to Parliament within 30 days of receiving it.
“The Constitution is very clear, 30 days from the date it is presented to him or her,” Tayebwa said.
Following the President’s decision to return both bills, Parliament will reconsider the proposed amendments, including the disputed withholding tax on betting winnings.
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