Business
Govt expenses exceeded planned target by sh313b in August—report
The August 2026 Performance of the Economy Report by the Ministry of Finance says the higher-than-programmed expenses were mainly driven by higher spending on grants, social benefits, and other expenses, which exceeded their respective monthly targets.
Permanent Secretary and Secretary to the Treasury, Dr Ramathan Ggoobi. (File photo)
By: Umaru Kashaka, Journalist @New Vision
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Ugandan government expenses amounted to sh3.317 trillion in August 2026, exceeding the programmed target of sh3.003 trillion by sh313.86 billion, the latest report shows.
The August 2026 Performance of the Economy Report by the Ministry of Finance says the higher-than-programmed expenses were mainly driven by higher spending on grants, social benefits, and other expenses, which exceeded their respective monthly targets.
Grants amounted to sh1.235 trillion, against the programmed sh1.020 trillion, representing an overrun of sh214.99 billion.
Of the total grants, sh617.77 billion was transferred to local governments, while sh123.36 billion and sh458.69 billion were transferred to tertiary institutions and other agencies.
The higher performance in grants was attributed to higher transfers for industrial and economic development, talent identification & development, and Uganda National Airlines.
Social benefits amounted to sh200.52 billion, compared to the planned target of sh124.03 billion. The higher-than-planned outturn was mainly attributed to increased expenditure on pensions and gratuities, following the retirement of a number of police and military personnel during the month.
Other expenses amounted to sh176.32 billion, which was 68.8% above the programmed target of sh104.43 billion.
The higher outturn was mainly attributed to higher transfers to other Government institutions, including the national sports associations/federations such as the Federation of Uganda Football Associations.
During the month of August 2026, spending on acquisition of non-financial assets amounted to sh287.22 billion, a 51.9% performance rate against the sh553.14 billion programme for the month. Of this, sh184.87 billion was domestic development while sh102.35 billion was externally financed development spending during the month.
Total revenues
Social benefits amounted to sh200.52 billion, compared to the planned target of sh124.03 billion. The higher-than-planned outturn was mainly attributed to increased expenditure on pensions and gratuities, following the retirement of a number of police and military personnel during the month.
Other expenses amounted to sh176.32 billion, which was 68.8% above the programmed target of sh104.43 billion.
The higher outturn was mainly attributed to higher transfers to other Government institutions, including the national sports associations/federations such as the Federation of Uganda Football Associations.
During the month of August 2026, spending on acquisition of non-financial assets amounted to sh287.22 billion, a 51.9% performance rate against the sh553.14 billion programme for the month. Of this, sh184.87 billion was domestic development while sh102.35 billion was externally financed development spending during the month.
Total revenues
During August 2026, total revenue (comprising domestic revenue and grants) amounted to sh2.895 trillion, representing an 87.8% performance rate against the monthly target of sh3.299 trillion.
This resulted in a total shortfall of sh403.29 billion, driven primarily by underperformance in domestic revenue collections and lower-than-target grant receipts.
Domestic revenue and local Government revenue collections totalled sh2.872 trillion, falling short of the target of sh3.238 trillion by sh365.68 billion. This was mainly due to shortfalls recorded in both tax collections and other revenue (non-tax revenue).
Tax collections registered a shortfall of sh312.64 billion against the sh2.975 trillion target, reflected across all major tax handles: Indirect taxes recorded the largest shortfall at sh170.39 billion, driven primarily by lower-than-projected collections in excise duty (sh34.38 billion), largely due to weak performance in key manufacturing sectors, notably beer, cooking oil, and cement.
Value Added Tax (VAT) also registered a shortfall (sh136.01 billion) mainly due to lower collections from electricity, cement, soft drinks, and the hospitality sector (hotels and restaurants).
Direct Taxes fell short of target by sh108.43 billion, largely due to underperformance in corporate taxes, which missed the target by sh28.32 billion, largely due to lower-than-expected profitability of firms. International Trade Taxes registered a shortfall of sh49.36 billion, largely due to lower-than-expected collections from import duties, excise duties, VAT on imports, and surcharge collections.
This resulted in a total shortfall of sh403.29 billion, driven primarily by underperformance in domestic revenue collections and lower-than-target grant receipts.
Domestic revenue and local Government revenue collections totalled sh2.872 trillion, falling short of the target of sh3.238 trillion by sh365.68 billion. This was mainly due to shortfalls recorded in both tax collections and other revenue (non-tax revenue).
Tax collections registered a shortfall of sh312.64 billion against the sh2.975 trillion target, reflected across all major tax handles: Indirect taxes recorded the largest shortfall at sh170.39 billion, driven primarily by lower-than-projected collections in excise duty (sh34.38 billion), largely due to weak performance in key manufacturing sectors, notably beer, cooking oil, and cement.
Value Added Tax (VAT) also registered a shortfall (sh136.01 billion) mainly due to lower collections from electricity, cement, soft drinks, and the hospitality sector (hotels and restaurants).
Direct Taxes fell short of target by sh108.43 billion, largely due to underperformance in corporate taxes, which missed the target by sh28.32 billion, largely due to lower-than-expected profitability of firms. International Trade Taxes registered a shortfall of sh49.36 billion, largely due to lower-than-expected collections from import duties, excise duties, VAT on imports, and surcharge collections.