Uganda government fiscal deficit hit sh3.148 trillion in May

KAMPALA - Uganda’s government operations resulted in a fiscal deficit (net borrowing) of sh3.148 trillion in May 2025, the Ministry of Finance says in a report.

The Performance of the Economy report for May 2025 says this was higher than the projected deficit of sh2.372 trillion, mainly on account of higher than planned expenditure and lower than programmed tax and non-tax revenues during the month.

Preliminary revenue data shows that collections in May 2025 amounted to sh2.694 trillion, posting a 98.3% performance against the sh2.741 trillion plan for the month.

Of this, sh2,376 trillion were tax collections while sh177.10 billion and sh140.92 billion were non-tax revenue and grants, respectively.

Tax revenue collections for the month posted a sh2.00 billion surplus against the planned sh2.374 trillion.

This was mainly driven by taxes on international trade and transactions, which posted a sh13.48 billion surplus against the sh929.46 billion target, on account of higher than planned petroleum duty collections for the month.

Corporation tax collections during the month posted a surplus of sh73.74 billion.

However, the gains were more than offset by significant shortfalls in PAYE and withholding tax collections.

These shortfalls negatively impacted the overall performance of Income tax, resulting in an aggregate shortfall of sh1.75 billion for the month.

Similarly, consumption taxes amounted to sh629.00 billion, posting a shortfall of sh16.32 billion during the month as both Value Added Tax and excise duty performed below the respective targets for the month.

The report says some of the major contributors to this shortfall include items such as wine and spirits, sugar, and phone talk time, among others.

During May 2025, non-tax revenue collections amounted to sh177.10 billion against the sh197.75 billion target, implying an 89.5% performance rate for the month.