Current and former Members of Parliament (MPs), along with Parliament staff, will now benefit from tax waivers on earnings from the Uganda Parliamentary Savings and Credit Cooperative (SACCO). This decision follows an appeal by the UPDF’s Wazalendo SACCO, which protested the Uganda Revenue Authority’s (URA) attempt to impose withholding tax on SACCOs’ earnings.
The announcement was made by Robert Migadde, Chairperson of the Parliamentary SACCO, during the Annual General Meeting held September 13, 2024 at Parliament.
Migadde revealed that over UGX 514 million, previously withheld from MPs’ earnings, will be refunded to their accounts.
“As a result of this, our SACCO has withheld tax of UGX 514 million from members’ earnings since June 30, 2023, which weren’t yet remitted to URA. The Board has decided that this money should be reversed to the respective members’ savings accounts,” he stated.
“I wish to inform you that this action has been completed, and members should be pleased to find this money in their accounts by June 30, 2025,” Migadde added.
Earlier in July, the Uganda Cooperative Savings and Credit Union (UCSCU), which oversees savings and credit cooperatives in Uganda, raised concerns over URA’s demands for continued withholding tax on interest and dividends paid to members. This demand contradicted a 2023 government indication that such taxation was irregular.
Following the Attorney General’s guidance, the UCSCU instructed its members not to comply with URA’s withholding tax demands. The exemption from withholding tax applies broadly to all SACCOs, not just those linked to Parliament, highlighting the essential role these financial entities play in promoting savings among Ugandans.
However, the ongoing debate regarding the tax status of SACCOs continues, with the International Monetary Fund (IMF) suggesting that the government should reevaluate these exemptions as part of broader revenue reforms.
