Uganda’s Parliament has approved the implementation of a 5% tax on the gross income derived from digital services by non-resident providers when serving local consumers. This tax will come into effect starting from July 1, 2023.
This decision is part of the 2023 Income Tax (Amendment) Bill and covers a range of digital services, including online advertising services, data services, services offered through online marketplaces or intermediation platforms (such as accommodation, vehicle hire, and transport marketplaces), digital content services (including accessing and downloading digital content), online gaming services, cloud computing services, data warehousing, services on social media platforms, internet search engines, and any other digital services that may be specified by the Minister through statutory instruments.
Additionally, it’s worth noting that Kenya is currently considering the withdrawal of its Digital Services Tax (DST) as part of the OECD’s global tax renegotiations, aimed at achieving greater harmony in the taxation of foreign digital revenues.
For businesses seeking assistance in calculating DST or VAT for Uganda or any other country worldwide, VATCalc offers a VAT Calculator that can seamlessly integrate into ERP systems, marketplaces, and billing processes. Feel free to contact VATCalc to learn more about this service.