Uganda Operators Implement 15% Tax on Net Gaming Winnings

Licensed betting and gaming companies in Uganda are working with tax and gaming authorities on the implementation of a 15% withholding tax charged on player winnings after the original stake is deducted.

National Lotteries and Gaming Regulatory Board CEO Denis Mudene Ngabirano said after a meeting with the Uganda Revenue Authority and licensed operators that the tax is calculated on the difference between the payout and the amount staked. Winnings paid by an operator licensed to conduct the National Lottery are excluded.

The distinction is important for players and operator payment systems. The headline 15% rate does not mean that 15% of every payout is removed before the money reaches the player.

UGX300,000 Payout Carries UGX37,500 Tax

URA's guidance for gaming and betting operators uses the example of a UGX50,000 stake producing a UGX300,000 payout:

Stake – UGX50,000;

Total payout – UGX300,000;

Taxable winnings – UGX250,000;

15% withholding tax – UGX37,500;

Player receives – UGX262,500.

In that case, the deduction equals 12.5% of the full payout rather than 15%.

The effective percentage changes with the size of the return. On a payout worth twice the original stake, the tax amounts to 7.5% of the total payout. At three times the stake it is 10%, while a payout worth 10 times the stake produces an effective deduction of 13.5%.

The rate approaches 15% as the winnings become larger relative to the original stake, but the stake itself remains outside the taxable amount.

URA classifies the withholding as a final tax. Operators must also submit a monthly withholding tax return by the 15th day of the following month.

Casino Winnings Remain Inside the Tax Base

The treatment of casino winnings was one of the points contested while the 2026 tax legislation was going through Parliament. An earlier version would have exempted winnings from licensed land-based casinos. President Yoweri Museveni returned the provision to Parliament, arguing that separate treatment for casinos could create opportunities for tax avoidance.

Parliament later removed the casino exemption, while retaining the exemption for the National Lottery. Lawmakers said the change would help protect a projected UGX65 billion in revenue for FY2026/27.

The result puts betting, online gaming and land-based casino winnings under the same withholding framework.

What Happens Next

The timing of the implementation work creates another issue for operators. The Income Tax (Amendment) Act was assented to on August 20 but took effect from July 1, 2026. URA has confirmed that provisions of the Act apply from that July 1 effective date. That leaves operators dealing with a tax regime whose legal start predates presidential assent by more than seven weeks.

The September meeting between URA, the regulator and licensed gaming companies therefore moves the issue from legislation into day-to-day compliance. Operators need payment systems capable of matching each payout with its original stake, calculating the taxable gain and reporting the withholding to URA.

The next point to watch is the treatment of the July-August period. URA's published gaming guidance sets the calculation and monthly filing requirement, but does not currently spell out a separate transitional process for gaming deductions covering the period before the Act was assented to.