Uganda has removed a planned tax exemption for customers of land-based casinos, bringing physical gambling venues under the same 15% withholding tax on net winnings that applies to other betting and gaming activities.
Parliament approved the change on 4 August after accepting a recommendation from President Yoweri Museveni to revise the Income Tax (Amendment) Bill 2026. The earlier version of the legislation would have excluded winnings from licensed land-based casinos from the new withholding tax.
Under the revised approach, operators must deduct 15% from taxable player winnings, calculated as the difference between the payout and the amount staked. Winnings paid by licensed national lottery operators remain exempt.
Museveni returned the bill to Parliament in July rather than approving the exemption. He argued that allowing physical casinos to receive preferential treatment would create an imbalance between businesses offering substantially similar gambling products and could provide opportunities for tax avoidance.
The government expects the broader gambling tax reforms to generate around UGX65 billion ($17.5 million) in additional revenue. Parliament’s Committee on Finance, Planning and Economic Development supported the president’s position, concluding that different tax treatment based solely on whether gambling takes place online or inside a physical casino could increase the risk of revenue leakage.
The decision forms part of a wider overhaul of Uganda’s gambling taxation system for the 2026-27 financial year.
The Lotteries and Gaming (Amendment) Act 2026 introduced a uniform 30% tax on betting and gaming activity, calculated on stakes less payouts. Betting had previously been taxed at 20%, while gaming was already subject to the 30% rate. The harmonised system took effect from 1 July 2026.
At the same time, Uganda introduced the 15% withholding tax on player winnings as part of its Income Tax reforms. The subsequent removal of the land-based casino exemption means that physical casinos will no longer receive different treatment from online betting and gaming businesses under the winnings-tax framework.
The changes significantly tighten Uganda’s gambling tax regime, increasing the burden on betting operators while also applying a direct levy to players’ net returns. The government has presented the reforms as a way to standardise taxation across the industry and reduce opportunities for businesses to structure gambling activity around more favourable tax treatment.