Uganda has until now tied mandatory electronic invoicing to Value Added Tax registration, so only firms with annual turnover above Ush300 million — roughly US$80,000 — were required to issue electronic fiscal invoices. According to a public notice by the Uganda Revenue Authority (URA), first published on 10 August 2026, that boundary has shifted.
Uganda moves EFRIS beyond VAT-registered firms
The URA notice confirms that from 1 July 2025, businesses in 12 sectors must use the Electronic Fiscal Receipting and Invoicing Solution (EFRIS), even if they are not registered for VAT. The sectors include manufacturing, mining and quarrying, water supply and waste management, electricity and gas, construction, transport and storage, accommodation and food services, information and communication technology, real estate, professional and technical services, arts and recreation, and wholesale and retail fuel. As a result, large swathes of Uganda’s formal and semi-formal economy are being brought onto a digital invoicing grid.
Tax authority guidance and specialist tax alerts note that the new rules aim to widen the tax base and tighten compliance in sectors with high transaction volumes and cash use. However, the URA has also signalled a degree of proportionality. An industry-focused report on the changes highlights that micro-businesses with annual turnover below Ush10 million and individuals earning small amounts of rental income remain outside mandatory EFRIS, unless they transact with EFRIS-compliant entities. That threshold helps to shield the smallest traders, while still pulling their value chains into the system when they sell to larger businesses.
Uganda’s phased EFRIS expansion is less about squeezing taxpayers and more about making every shilling in key value chains visible.
How does Uganda’s approach compare with Tanzania and Kenya?
Uganda’s sequencing aligns more closely with Tanzania than with Kenya’s big-bang model. Tanzania introduced mandatory electronic payments for specified transactions through the Electronic Transactions (Mandatory Electronic Payments for Specified Transactions) Order, 2026, which took effect on 1 July 2026. The order, issued under the Electronic Transactions Act, requires electronic payment for public transport services, shopping malls, gyms, cinemas, fuel stations, conference and event venues, sports arenas, school and university fees, hotels and restaurants, tourism services, real estate transactions, motor vehicle sales, and payments through agricultural cooperative unions for strategic crops.
This Tanzanian regime does not yet require universal e-invoicing, but it forces digital trails in high-value, high-volume segments and phases in compliance over time. Uganda is effectively mirroring this targeted logic by starting with 12 sectors and allowing limited, clearly defined exemptions. In transport, URA materials indicate that passenger land services such as taxis, motorcycle taxis, shuttles and buses are not yet under full mandatory EFRIS, focusing instead on fuel and freight-related activity. In ICT, non-resident digital service providers that already pay Digital Service Tax are not being pushed immediately into Uganda e-invoicing obligations, reducing friction with cross-border platforms.
Kenya has moved in the opposite direction. The Kenya Revenue Authority rolled out mandatory electronic tax invoicing infrastructure under changes in the Finance Act 2023. Electronic invoicing became formally effective from 1 January 2024, with enforcement ramping up from 1 January 2026 through income and expense validation. The Kenyan system demands e-invoices across the board and has had to introduce reverse invoicing, allowing buyers to generate e-invoices on behalf of suppliers in the informal and agricultural sectors to address compliance bottlenecks. That has increased administrative complexity for large corporates and created new integration costs for smaller suppliers.
What does the divergence mean for investors?
For investors, the divergence matters. Uganda and Tanzania are signalling a preference for gradualism and sector focus, while still converging with Kenya on the core principle that deductible expenses and corporate tax positions must rest on verifiable digital records. In all three markets, companies that cannot issue compliant electronic invoices risk losing access to larger customers, even if they remain below formal tax thresholds.
The strategic opportunity now sits with payment providers, enterprise software firms, and specialist compliance platforms that can plug EFRIS and equivalent systems into everyday business tools in East Africa. Investors should watch how quickly Uganda’s 12 sectors adopt EFRIS in practice, whether Tanzania extends its electronic payment mandate into full e-invoicing, and how Kenya’s reverse-invoicing fix reshapes supply chains across the region.
Quick answers
From 1 July 2025, 12 sectors must use EFRIS even without VAT registration. These include manufacturing, mining, construction, transport, ICT, real estate, accommodation, electricity and gas, water supply, professional services, arts and recreation, and wholesale and retail fuel.
Micro-businesses with annual turnover below Ush10 million remain outside mandatory EFRIS. However, if they transact with EFRIS-compliant entities, they are indirectly pulled into the system.
Uganda is using a gradual, sector-by-sector rollout similar to Tanzania, whereas Kenya mandated e-invoicing across the board from 1 January 2024 and introduced reverse invoicing to address informal sector compliance gaps from 1 January 2026.
