Uganda 2025/2026 Budget Brief

The theme of the budget for the financial year 2025/2026 is “Full Monetisation of Uganda’s Economy through Commercial Agriculture, Industrialisation, Expanding and Broadening Services, Digital Transformation and Market Access”.

This budget is the first of its implementation of the National Development Plan IV with the goal of having higher household incomes, full monetization of the economy and employment for sustainable socioeconomic transformation. This goal will be pursued under the areas of Sustainable Industrialization for Inclusive Growth, Employment and Wealth Creation. 

The economy is projected to grow by 6.3% to Ushs 226.3 trillion (USD 61.3 billion) by the end of June 2025 and expected to expand by 7% to Ushs 254.2 trillion (USD 66.1 billion) by June 2026 and then to double digits once oil production commences. These are higher growth rates compared to the 6.1% achieved in FY2023/24 and 5.3% in FY2022/23..

This growth is attributed to a stable macro-economic environment; strong Government investments in infrastructure that have reduced the cost of doing business, including electricity, transport, and ICT; improved access to affordable credit; attraction of Foreign Direct Investment (FDI); and support to private sector growth through establishment of industrial parks to increase manufacturing.

The growth has also been due to Government’s targeted interventions through a number of wealth creation initiatives. The Government has in the last ten 10 years cumulatively invested over Ushs 9 trillion in key wealth creation initiatives which include:

These initiatives are expected to increase Uganda’s GDP by more than double, to USD 158 billion by 2030.

In terms of purchasing power parity (PPP) terms, the economy is projected to be at USD174.2 billion by the end of the financial year June 2025; and is projected to expand to Ushs 252.6 trillion in the next financial year. This shall translate into increased household incomes which are expected to increase from USD 1,259 per capita in FY2024/25 to USD1,330 in FY2025/26.


The Ugandan currency has been one of the most stable in the whole of Africa. The shilling appreciated by 4% year on year in April 2025 compared to the same month in 2024. This resilience has been due to good export performance, strong inflows of foreign direct investments and tourism receipts. 

Foreign Direct Investments (FDI) inflows were worth USD3.48 billion for the twelve months ending March 2025, compared to USD 2.99 billion during the same period in 2024. This performance was due to improved competitiveness of the economy.


Revenue collections

The net revenue collections from July 2024 to April 2025 amounted to Ushs24,905.41billion, compared to the projection of Shs24,994.27billion, resulting in a shortfall of Ushs88.85billion and 99.64percent performance against the target. This performance marks a growth of 12.64 percent (Ushs2,595.88billion) when compared to the same period in FY2023/24. This shortfall was observed across two major tax categories. 

Taxes on international trade transactions recorded a significant deficit of Ushs 236 billion, with collections of Ushs 8.9 trillion against a target of Ushs 9.2 trillion. This underperformance was primarily attributed to lower than projected fuel imports, which resulted in petroleum duty collections achieving only 76.8% of their target. 

Consumption taxes (indirect domestic taxes) also experienced a shortfall of Ushs 204.8 billion, collecting Ushs 6.012 trillion against a target of Ushs 6.216 trillion. Value Added Tax (VAT) accounted for the majority of this shortfall (Ushs 149.46 billion), with excise duty contributing Ushs 55.35 billion. Goods such as soft drinks, cooking oil, spirits/waragi, and sugar recorded lower than projected collections, and sectors including construction, real estate, trade, and hotels & restaurants also registered lower than anticipated VAT. 

Direct domestic taxes (income taxes) recorded a surplus of Shs316.8 billion. While corporation tax performed strongly, exceeding its target by Ushs 434 billion, PAYE, WHT and tax on bank interest recorded deficits. The revenue collection is projected to reach Ushs 31.9 trillion for the financial year ending 30 June 2025(14.3% of GDP) with total expenditure estimated at Ushs 51.53 trillion hence a budget deficit at 7.6% of GDP. The total projected revenue for the financial year 2025/26 is Ushs 37.2 trillion.