By: Isaac Kwabena Boadu Date: 28th April, 2026
The Ugandan government has introduced the External Trade (Amendment) Bill, 2026, proposing a 30% environmental levy on imported second-hand clothing, citing environmental concerns and a desire to stimulate local production. The levy would increase the current surcharge from 15% to 30% of the Cost, Insurance, and Freight (CIF) value, potentially generating revenue and incentivizing domestic textile production.
The Finance Minister of Uganda, Hon.Matia Kasaija has argued that the levy will help mitigate environmental degradation and promote economic diversification. However, stakeholders are divided on the proposal’s impact, with some warning of potential supply chain disruptions and price hikes, while others see opportunities for local industry growth and job creation.
The Uganda Chamber of Commerce, Industry, and Agriculture (KACITA) notes that the used clothing sector contributes significantly to government revenue and questions the levy, given existing tariffs and quotas. The Civil Society Budget Advocacy Group (CSBAG) suggests that the levy may lead to higher prices but could also stimulate local manufacturing and cotton sector development. The bill is currently before the country’s Parliament, with a proposed effective date of July 1st, 2026.
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