In a decisive move to accelerate its green mobility agenda, Uganda has introduced a comprehensive package of tax incentives aimed at stimulating the local assembly of electric motorcycles. This policy shift is a cornerstone of the country’s broader National E-Mobility Strategy, launched in 2024, which seeks to reduce greenhouse gas emissions, cut fossil fuel dependency, and position Uganda as a regional hub for clean transport technologies.
Under the new guidelines, companies that assemble electric two-wheelers domestically will benefit from:
- Exemption from import duties and VAT on all parts and components used in local assembly.
- A five-year income tax holiday for new entrants in the electric mobility sector.
These incentives are designed to lower the cost of production, encourage foreign and local investment, and curb the importation of fully built internal combustion engine (ICE) motorcycles.
This isn’t Uganda’s first attempt to support electric vehicle adoption. In early 2024, the government waived import duties on electric vehicles to encourage uptake. However, the policy was short-lived, with tariffs reinstated just months later. The current approach marks a strategic pivot—shifting focus from import facilitation to building a domestic manufacturing base.
Electric mobility firm Spiro, which operates a growing network of battery-swapping electric motorcycles, is among the companies expected to benefit significantly from the new policy. Other startups like GOGO and Zembo are also scaling operations, supported by the expanding infrastructure for electric boda bodas.
Beyond tax incentives, Uganda’s National E-Mobility Strategy outlines a holistic plan to build an end-to-end ecosystem for clean transport. Key pillars include:
- Infrastructure development (e.g., charging and battery-swapping stations)
- Regulatory frameworks to ensure safety and quality
- Skills training to support a local workforce in EV manufacturing and maintenance
The strategy sets ambitious targets, including a full transition to electric motorcycles and public transport by 2030, and electrification of passenger vehicle sales by 2040. Uganda’s policy shift comes as Africa’s electric two-wheeler market gains momentum, with projected annual growth of 18.7% and expected sales of 820,000 units by 2025, rising to nearly 5 million by 2040.
By focusing on local assembly, Uganda stands to capture more value from the e-mobility supply chain, reduce its import bill, and potentially export electric motorcycles and components under the African Continental Free Trade Area (AfCFTA).
With these incentives, Uganda is not only addressing climate goals but also laying the groundwork for industrial transformation. By fostering a viable business environment for electric mobility, the country is taking a bold step toward a sustainable, self-reliant, and export-ready green economy.
