Parliament Rejects Tax on 'Nkuba Kyeyo' and Personal Asset Sales

Members of Parliament have thrown out a government-proposed tax on income earned by Ugandans working abroad, often referred to as ‘Nkuba Kyeyo’. The decision was made during the passing of the Income Tax (Amendment) Bill, 2026, with legislators arguing that such a tax would disproportionately affect low-income migrant workers who send crucial remittances back home.

Lawmakers also opposed taxing profits from the sale of non-business assets, such as jewelry or personal property. The rationale given was the difficulty in distinguishing personal transactions from business dealings, especially when assets are sold for personal needs like medical expenses.

Amos Kankunda, Chairperson of the House Committee on Finance, emphasized the committee’s goal to “balance revenue mobilisation with economic growth and taxpayer protection.” He noted that the deleted provisions were seen as impractical or punitive, potentially hindering economic activity.

The approved Income Tax (Amendment) Bill, 2026, does include reforms such as taxing software under royalties to bring digital services into the tax net. It also exempts employees earning Shs335,000 monthly from Pay As You Earn (PAYE) and reduces the investment threshold for hotel developers to encourage tourism.

Alongside, Parliament also passed the Lotteries and Gaming (Amendment) Bill, 2026, to streamline tax rates and treatment within the gaming sector.

The Bujagali Hydropower Project has received a six-year extension of its tax exemption, intended to prevent an increase in electricity tariffs for consumers.

Source: https://www.howwe.ug/news/national/42861/parliament-rejects-taxing-nkuba-kyeyo-and-kadama-earnings