Parliament Approves President's Tax Proposals on Plastics and Casinos

Members of Parliament have supported President Yoweri Museveni’s proposed amendments to two key financial bills, the Excise Duty (Amendment) Bill, 2026, and the Income Tax (Amendment) Bill, 2026. The Parliament has agreed to maintain a reduced excise duty on single-use plastics and to remove tax exemptions for winnings derived from land-based casinos.

Regarding the Excise Duty (Amendment) Bill, Parliament accepted the President’s recommendation to keep the excise duty on single-use plastics at 2.5% or US$70 per tonne, whichever is higher. This is a significant reduction from the 25% or US$1,500 per tonne previously passed by the House. The Committee on Finance, Planning and Economic Development, in its report presented by Hon. James Kakooza, concurred with the President, suggesting that the higher tax rate should only be implemented after a thorough study of its potential impact on the plastics industry. The committee also advocated for expanding the tax to more single-use plastic items while excluding reusable plastics, sanitary pad packaging, and pharmaceutical products.

However, some members raised objections. Hon. Gyaviira Lubowa questioned the legality of the 12th Parliament revisiting bills passed by the dissolved 11th Parliament, arguing for a fresh legislative process. He also expressed concern that the government’s shifting stance on plastics and the adoption of the President’s proposal would lead to an estimated revenue loss of Shs208 billion. A minority report by Hon. Karim Masaba supported the lower tax rate but opposed expanded exemptions, projecting a revenue loss of Shs205 billion.

Minister of Finance, Hon. Henry Musasizi, countered the revenue loss estimates, stating the actual shortfall would be closer to Shs7 billion, and defended the government’s evolving position based on new information.

In relation to the Income Tax (Amendment) Bill, Parliament approved the President’s proposal to remove the withholding tax exemption for winnings from land-based casinos. The Chairperson of the Finance Committee, Hon. Maximus Ochai, explained that this exemption would create tax loopholes and revenue leakage. Extending the tax to casinos ensures equitable treatment with other gaming operators and is projected to protect Shs65 billion in revenue.

Despite some dissent, Parliament ultimately adopted the majority committee reports and the President’s recommendations on both bills.