The Executive Director of the Federation of Small and Medium Enterprises, John Walugembe, has urged the government to simplify taxes, reduce excessive licensing requirements and improve dispute resolution mechanisms to create a more supportive environment for businesses in Uganda.
Walugembe said inconsistent policy implementation and frequent changes in government programmes undermine efforts aimed at supporting business growth.
According to him, initiatives designed to stimulate economic growth often lose momentum because of poor execution and shifting priorities.
“We must focus on executing the policies we set. If we agree on a growth plan, we should implement it and hold people accountable for delivering results,” Walugembe said.
He also criticized the country’s tax structure, arguing that businesses—especially small enterprises are burdened by multiple taxes and levies collected by different government agencies.
Walugembe suggested that authorities consider introducing a simplified tax system where businesses make a single annual payment that covers all relevant taxes and fees.
“A business should know exactly how much it is expected to pay in a year and plan accordingly,” he said. “Instead of different agencies collecting different taxes at different times, there should be one interface and one place where businesses can make their payments.”
He warned that excessive taxation can push businesses out of operation, ultimately harming government revenue and employment.
“If you demand too much from businesses at once, they close. When they close, the country loses both revenue and jobs,” he said.
Walugembe also raised concerns about the high number of licenses and regulatory requirements businesses must meet before operating legally.
He argued that a streamlined licensing system—where one license incorporates all regulatory approvals—would reduce costs and bureaucratic delays.
“If I am operating a food business, that single license should include all the necessary clearances. Once I have it, I should be able to operate without being shut down by another agency later,” he said.
He further pointed to inefficiencies within government offices, saying bureaucratic procedures and delays often slow down service delivery for entrepreneurs seeking permits or approvals.
Walugembe also highlighted the slow pace of resolving commercial disputes in Uganda’s legal system, which he said discourages business activity.
According to him, some commercial disputes take between three and five years to be resolved in court, a delay he described as harmful to businesses that rely on quick resolution to continue operations.
“One of the characteristics of a strong business environment is the ability to resolve disputes cheaply and quickly,” he said.
Walugembe recommended expanding the use of mediation and arbitration mechanisms to settle commercial disputes faster, allowing businesses to continue operating without prolonged legal battles.
He also acknowledged concerns raised by business owners about corruption and informal payments demanded by some officials.
Walugembe said tackling corruption and improving accountability within regulatory institutions would help restore confidence among entrepreneurs.
“If we organize government systems properly and give businesses a clear, predictable framework to operate in, they will grow and contribute more to the economy,” he said.
