BUDGET REACTIONS: Good Takeaways From Budget Forecasting
The doubling of the VAT registration threshold to sh300m will also bring more SMEs into the formal economy, expanding the addressable market for financial services.
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NATIONAL BUDGET READING 2026
Abraham Banaddawa: CEO, Level Africa Limited
This budget sends a clear signal to the financial sector. Uganda is open, growing, and increasingly bankable.
The macroeconomic foundations are strong. Low inflation at 3.8%, a stable shilling and foreign exchange reserves nearly doubling create exactly the kind of environment where financial institutions can price risk confidently and deploy capital at scale. Combined with 10.2% projected growth on the back of First Oil, we are looking at a market that will generate significant new demand for credit, insurance, investment products and wealth management services. Two measures stand out for us.
The equalisation of tax treatment for Tier 4 financial institutions, allowing deductions for bad debt provisioning, directly reduces the cost of capital and should translate into more competitive lending rates for businesses and households.
The doubling of the VAT registration threshold to sh300m will also bring more SMEs into the formal economy, expanding the addressable market for financial services.
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