Kampala Central MP Muhammad Nsereko has raised concern over a proposal to impose Value Added Tax (VAT) on software, warning that it could undermine Uganda’s digital transformation agenda and stifle innovation.
Nsereko made the remarks while seeking the Speaker’s indulgence to address Clause 4 of the VAT (Amendment) Bill, 2026, which introduces VAT on software.
He argued that the move risks contradicting government’s own policy direction, particularly efforts to position Information and Communication Technology (ICT) as a key driver of economic growth.
Referencing the President’s manifesto, Nsereko noted that ICT is identified as a backbone for integrating young innovators and transforming society.
“I have a huge passion for technology,” he said, describing it as an equaliser for unemployed but innovative young people and a critical enabler of growth in emerging economies.
He warned that taxing software could increase the cost of accessing digital tools, potentially limiting opportunities for startups, developers, and small businesses that rely on technology to scale.
Nsereko emphasised the need for policy coherence, urging lawmakers to align tax decisions with national goals of promoting innovation, digital inclusion, and youth employment.
