Business & Management
Study Reveals Taxation Issues in Uganda’s Informal Economy
A recent study by researchers at Makerere University’s College of Business and Management Sciences has identified the lack of a structured taxation framework for informal businesses as a significant cause of tax non-compliance among traders in Uganda. This revelation came from a collaborative research project involving eight university scholars, who examined the underlying factors contributing to the shadow economy and its implications for the national tax system.
The findings were presented by Dr. Ismail Kintu, the study’s Principal Investigator, at a dissemination workshop held in Nansana Municipality Council, Wakiso District, on Thursday. The research, initiated in 2022, aimed to assess traders’ perceptions of fairness within the taxation system and how this relates to voluntary tax compliance.
“Traders said the system is unfair to them,” Dr. Kintu explained during the workshop. “Our research aimed to understand what fairness means in Uganda’s context.” According to the study, fairness in the tax system is crucial for voluntary compliance, suggesting that taxes should be aligned with one’s revenue, and penalties should be applied equitably.
The researchers developed a proposed framework for taxing the informal economy, emphasizing the importance of consulting key stakeholders, such as district commercial officers, tax consultants, and leaders from traders’ associations, before implementing tax policies. The framework recommends engaging these stakeholders in meetings with the Uganda Revenue Authority (URA) and the Ministry of Finance to ensure that new tax policies are inclusive and fair.
The study also suggests the need for flexibility in tax collection, advocating for payment in installments and prior notification to traders before collecting taxes. This approach, the researchers argue, would help build trust and encourage compliance among informal traders.
The researchers’ proposed framework includes annual mapping of policy gaps in the informal economy and developing solutions to address them. This process would involve regular consultations with stakeholders to refine the tax system and maintain fairness.
Local officials who attended the workshop expressed support for the research findings. Mr. Festo Tandeka, Nansana Municipality town clerk, encouraged traders to cultivate a culture of paying taxes but cautioned against excessive taxation. He recommended allowing tax payments in installments to avoid overburdening traders.
Similarly, Mr. Shaffic Ali Nsubuga, Nansana Municipality Deputy Resident District Commissioner, urged tax officers to approach tax collection with compassion, suggesting that prior notices be given to traders before taxes are collected.
The findings of the Makerere University study arrive at a critical time, as Ugandan traders have recently protested against increasing taxes. Mr. Joshua Mawerere, a youth representative from the Kampala City Traders Association, welcomed the study, noting that it brings clarity to issues surrounding tax policies. He urged the government to raise awareness about new tax systems, like the Electronic Fiscal Receipting and Invoicing Solution (EFRIS), which some traders mistakenly perceive as additional taxes.
The study’s comprehensive approach to understanding the informal economy’s taxation challenges may pave the way for a more inclusive and equitable tax system in Uganda, fostering greater compliance and reducing the size of the shadow economy.
The research was funded by the government of Uganda through the Makerere University Research and Innovations Fund (Mak-RIF). Speaking at the stakeholders’ engagement on April 25th, Ms Evelyn Nyacho who represented the chair of the grants committee, congratulated Dr. Kintu and team upon the timely research finding. She said the findings would help URA and the traders coming after a traders’ strike over taxation. She said Mak-RIF was happy to sponsor research that is aimed at solving society issues like taxation. “I was happy to learn that taxes can be pay in installments. I hope traders can embrace this flexibility in paying taxes,” she said. She appreciated government for the research funding to the university. The government commits Shs30 billion annually to research at Makerere University in an effort to spur development of the country.
The research team
Dr Kintu (PI), Prof Eria Hisali (Co. PI), Dr Fred Bateganya, Dr Willy Kagarura, Mr Patrick Lumala, Mr Nicholas Musoke, Ms Marion Atukunda, and Ms Winfred Nalwoga.
Business & Management
PIM Centre Awards Certificates to Over 35 Officials Trained in Essentials of Public Investment Management
The Public Investment Management (PIM) Centre of Excellence at Makerere University has awarded certificates to more than 35 public officials who successfully completed a three-day training in the Essentials of Public Investment Management (PIM).
The training, held from September 23rd to 26th, 2025 at the College of Business and Management Sciences, aimed at strengthening the capacity of government officials to effectively identify, prepare, and implement public projects.
The closing ceremony was officiated by Ms. Belinda Bisamaza, who represented the Permanent Secretary/Secretary to the Treasury (PS/ST). In her remarks, Ms. Bisamaza commended participants for their commitment, noting that the training had offered a solid foundation in the entire PIM cycle — from project conceptualization and profiling, through monitoring and evaluation (M&E), to the use of the Integrated Bank of Projects (IBP), Environmental and Social Risk Management, and Public-Private Partnerships (PPPs).
“With these skills, you can contribute meaningfully to improving the quality of proposals submitted to the IBP, ensure better risk management, and enhance implementation through robust monitoring frameworks,” she said, adding that participants were now better prepared for advanced modules on financial appraisal, risk analysis, and stakeholder engagement.
Representing the PIM Centre, Prof. Eria Hisali highlighted the need for well-prepared projects that directly contribute to economic growth. “We must move away from the practice of developing projects only when funding is required. Instead, we should create a strong bank of quality projects from which government can easily draw,” he said.
The Manager of the PIM Centre, Dr. John Sseruyange, expressed gratitude to the participants and trainers for their dedication. He noted that the facilitators were drawn from Makerere University, the National Planning Authority (NPA), and the Ministry of Finance, Planning and Economic Development (MoFPED). Dr. Sseruyange also revealed that the Centre would be rolling out further in-depth training modules and creating opportunities for alumni to engage in consultancy and research work. The PIM Centre hosts the training as part of broader efforts by Makerere University, MoFPED, and NPA to strengthen Uganda’s public investment management systems, ensuring value for money, improved service delivery, and sustainable economic development.
Business & Management
PIM Centre Makerere, Graduates Second Cohort of Certificate in Financial Implications – Integrated Regulatory Cost-Benefit Analysis
Jinja, September 5, 2025
Thirty-one government officers from Ministries, Departments, and Agencies (MDAs) have successfully completed a two-week intensive training in the Certificate of Financial Implications (CFI) – Integrated Regulatory Cost-Benefit Analysis. The certification ceremony was held at the Pearl on the Nile Hotel, Jinja, marking another milestone in Uganda’s efforts to institutionalize evidence-based and fiscally responsible policymaking.
The training, delivered by the Makerere University Public Investment Management (PIM) Centre of Excellence in partnership with the Ministry of Finance, Planning and Economic Development (MoFPED), and National Planning Authority equipped participants with practical skills to evaluate policy and legislative proposals for their financial, economic, and social implications.
Speaking at the closing ceremony, Mr. Paul Mwanja, Commissioner for Infrastructure & Social Services at MoFPED, who represented the Permanent Secretary, commended the officers for their commitment at a time when government institutions are finalizing the Auditor General’s audits, implementing the FY2025/26 budget, rolling out the National Development Plan IV’s tenfold growth strategy, and preparing for the 2026 General Elections.
“Your participation affirms a collective commitment across Government to strengthen the quality, transparency, and credibility of public policymaking in Uganda,” Mr. Mwanja said. He urged graduates to return to their institutions as champions of reform, share their knowledge with colleagues, and drive the change needed in Public Finance Management. He also announced that the next cohort of the training will take place in January 2026.
Prof. Ibrahim Mike Okumu, Dean of the School of Economics at Makerere University, delivered the graduation address, highlighting the certificate’s importance in addressing Uganda’s triple challenge of scale, scarcity, and speed.
“This program does something unique. It teaches you not only to ask whether a policy or project is beneficial, but also whether it is affordable and resilient under real fiscal constraints,” Prof. Okumu noted. He challenged graduates to apply their skills at project, portfolio, and policy levels—ensuring value for money and enhancing public trust in government spending.
He further emphasized that Uganda’s pioneering approach to integrated CFI-CBA positions the country as a leader in Africa and beyond: “You, Uganda’s first CFI-CBA graduates, are now part of a global brain trust. Your work will speak to investors, parliaments, development partners, and above all, the Ugandan people.”
Dr. John Sseruyange, Manager of the PIM Centre of Excellence, expressed appreciation to participants for their active engagement throughout the training and thanked MoFPED and the faculty drawn from Makerere University, the National Planning Authority, Ministry of Finance, and the Ministry of Energy for their technical support.
The Certificate of Financial Implications – Integrated Regulatory Cost-Benefit Analysis was introduced following the Revised Guidelines for Financial Clearance, effective July 1, 2025. The guidelines require MDAs to prepare their own financial implications statements, subject to rigorous cost-benefit analysis, thereby strengthening linkages between fiscal responsibility and regulatory impact assessments.
With the successful completion of the second cohort, Uganda is steadily building a critical mass of professionals capable of embedding cost-benefit thinking across government, ensuring every shilling delivers maximum impact for citizens.
The Public Investment Management Centre of Excellence (PIM CoE) at Makerere University held its Steering Committee meeting on 4th September 2025 at Mestil Hotel in Kampala. The session, attended by all members, focused on reviewing progress, reflecting on achievements from the past financial year, and charting the way forward for the Centre.
About the PIM Centre of Excellence
The PIM CoE was established in March 2022 at Makerere University’s College of Business and Management Sciences (CoBAMS), in partnership with the Ministry of Finance, Planning and Economic Development (MoFPED). Its purpose is to strengthen Uganda’s public investment management system through training, research, and advisory services.
The Steering Committee plays a critical role in oversight, review, coordination, and advisory functions, guiding the Centre’s work and ensuring that public investment processes align with national development priorities.
Highlights from the Meeting
Speaking at the meeting, Dr. Joseph Muvawala, the Executive Director of the National Planning Authority, praised the October 2024 Annual PIM Conference for expanding perspectives on project design and delivery. He emphasized the importance of shifting from theory to practice in training, advocating for students and officials to engage with real-world projects. He also underscored the Centre’s new autonomy—transitioning from a subvention to a vote—which gives it greater independence but also demands stronger financial accountability. Dr. Muvawala further called for a permanent physical home for the Centre, noting that sufficient resources are available to make this possible and that negotiations with government are underway.
Mr. Ashaba Hannington, Director Budget at MoFPED, shared key achievements from the 2024/25 financial year. He noted that the Annual PIM Conference, organised jointly by MoFPED and the Centre, provided a vital platform for stakeholders to reflect on progress in public investment management.
Mr. Ashaba reaffirmed MoFPED’s commitment to working closely with the Centre to strengthen Uganda’s public investment capacity.
Prof. Eria Hisali, Co–Principal Investigator of the PIM CoE, outlined strategies to increase the Centre’s vibrancy and impact. He emphasized direct project engagement, advisory services, and peer reviews as ways to bridge the gap between theory and practice. Looking ahead, he revealed plans for a Master’s program in Economic and Investment Modelling, a Training of Trainers (ToT) initiative, and deeper practical capacity-building efforts.
Prof. Hisali also noted several successful trainings from the past year, including:
- 46 staff from MDAs trained in Essentials of PIM.
- 59 participants across two cohorts trained in Financial Appraisal and Risk Analysis.
- 25 participants trained in Economic Appraisal and Stakeholder Analysis.
He proposed the introduction of a “trailer feasibility test” to evaluate whether completed projects deliver benefits as projected and to address optimism bias in project planning.
Dr. John Seruyange, Manager of the PIM CoE, highlighted the Centre’s growing regional footprint. Beyond Uganda, six central government officers from Somalia have been trained in Infrastructure Asset Management, generating further interest in advanced training from Somalia, Zimbabwe, and Somaliland. To position itself as a regional hub, the Centre is preparing a prospectus to market its courses across Africa and beyond.
Why It Matters
The Steering Committee reaffirmed its commitment to ensuring that the PIM CoE remains a leading think tank and capacity-building hub for government and regional partners. By improving the appraisal, financing, and implementation of public projects, the Centre is strengthening accountability, enhancing service delivery, and contributing to Uganda’s broader development goals.
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