Uganda Revenue Authority registered its first monthly fiscal surplus in six months after stronger-than-expected tax collections helped the government raise more money than it spent in June, according to the Ministry of Finance.
Government operations ended the month with a fiscal surplus of about 517 billion Shillings, reversing the projected deficit of about 691 billion Shillings and marking the first monthly net lending position since December 2025.
The turnaround was driven by robust tax collections and lower-than-planned spending on some development projects.
The Uganda Revenue Authority (URA) collected 5.8 trillion Shillings during the month, about 800 billion Shillings above target. Finance Ministry data shows the additional revenue came almost entirely from taxes, while non-tax revenue and grants fell short of expectations.
URA Commissioner General John Musinguzi Rujoki attributed the performance to stronger economic activity, improved tax administration and better compliance by taxpayers as the financial year came to a close.
The June performance also helped offset weaker revenue collections recorded earlier in the financial year. According to URA Commissioner for Domestic Taxes Denis Kugonza Kateeba, the 2026 election period slowed business activity and disrupted tax enforcement during the first half of the financial year, contributing to revenue shortfalls.
Revenue improved significantly in the second half of the year as business activity normalised and tax compliance measures, including tax amnesties and administrative reforms, encouraged more taxpayers to meet their obligations.
The strongest gains came from broad-based improvements in tax collections, including income taxes, domestic consumption taxes and import-related taxes, reflecting increased business activity, consumer spending and international trade. While revenue exceeded expectations, government spending also remained high.
The government spent about 3.5 trillion Shillings on recurrent expenditure during June, slightly above its target, largely because of increased spending on salaries and other operational costs. The higher expenditure followed Parliament’s approval of supplementary budgets during the financial year, including an 8.1 trillion Shillings supplementary budget approved in December 2025 and another worth 1.1 trillion Shillings later in the year.
The supplementary appropriations attracted criticism from budget transparency advocates, who argued that approving large additional expenditures towards the end of the financial year limits parliamentary scrutiny and increases the risk of misuse of public funds.
Civil Society Budget Advocacy Group Executive Director Julius Mukunda warned that processing large supplementary budgets at the close of the financial year creates opportunities for financial mismanagement because agencies have limited time to spend the funds and Parliament has little opportunity to thoroughly scrutinise the requests.
Meanwhile, spending on development projects fell short of the government’s plans. Expenditure on non-financial assets reached about 1.8 trillion Shillings, representing roughly 80 percent of the planned budget for the month-URN. Give us feedback on this story through our email: kamwokyatimes@gmail.com
