A new tax measure is set to change how musicians, Masters of Ceremony (MCs), DJs and other public entertainers are paid in Uganda.
Under the Income Tax Amendment Act 2026, Section 135B introduces a 6% withholding tax on payments made to public entertainers. The person hiring or paying the entertainer is required to deduct the tax from the gross payment and remit it to the Uganda Revenue Authority (URA).
For example, if an entertainer is contracted for UGX 1 million, UGX 60,000 would be deducted as withholding tax, leaving the entertainer with UGX 940,000, before any other applicable considerations.
The measure covers a broad range of public entertainment, including people performing before audiences, cameras or microphones, as well as performers involved in stage and digital entertainment.
Tax experts say the 6% deduction should not simply be viewed as an additional cost to entertainers. It is an advance tax payment made on behalf of the entertainer, meaning the amount withheld can generally serve as a tax credit when the entertainer files their tax returns for the relevant accounting period.
However, the new requirement could have wider implications for the entertainment industry. Entertainers may begin negotiating their fees based on the net amount they want to receive, potentially increasing the cost of organising events. Whether entrance fees also increase could depend on factors such as the type of entertainment, sponsorship available, expected profits and the bargaining power of the performer.
Experts are therefore urging event organisers to understand the tax obligation before entering into contracts, while musicians, DJs, MCs and other entertainers are encouraged to understand how withholding affects their actual earnings.
Beyond the 6% deduction, industry stakeholders say entertainers should become more deliberate about what they are selling. Rather than focusing only on questions such as “How much are you paying me to perform?”, artists are being encouraged to consider the intellectual property, commercial rights and value attached to their performances.
The new measure is part of the broader effort to bring more income-generating activities into Uganda’s formal tax system as the entertainment industry continues to expand across music, television, events and digital platforms.
With the law now in force, entertainers and event organisers are being urged to properly factor the tax into their contracts and financial planning rather than simply inflating performance fees without understanding the obligation.
