Ugandan entertainers could soon feel the pinch after government tabled a proposal to introduce a 6% withholding tax on payments made to artists.
State Minister for Finance (General Duties), Henry Musasizi, presented the plan on Wednesday as part of eight amendment bills aimed at raising an extra UGX 1.74 trillion in revenue for the 2026/27 financial year.
If passed, event organizers will be required to deduct 6% directly from payments made to musicians, comedians, and theatre performers before they receive their money. The move is intended to bring the largely informal entertainment sector into the tax bracket, especially as URA tightens its grip on income tracking, including earnings from copyright collections.
Supporters of the proposal say it’s long overdue.
Media personality Douglas Lwanga has urged artists to get serious about their finances, advising them to hire tax consultants and start properly tracking their income and expenses.
But not everyone is buying it.
Critics, especially within the music business, warn that the new tax could backfire. Some consultants argue that instead of increasing compliance, it may push more artists to hide earnings, especially from cash-heavy gigs like weddings, bar shows, and private events.
With many entertainers already operating informally, the fear is that enforcement could become even more complicated.
For now, the proposed tax is still under parliamentary review, with debates expected to intensify in the coming weeks as stakeholders weigh in.
If approved, this could mark a major shift in how Uganda’s entertainment industry operates — moving from vibes and cash to receipts and deductions.
