This study investigated the relationship between digital taxation and e-commerce growth among traders in Kasita, a commercial zone in Kampala, Uganda. The study was motivated by the Uganda Revenue Authority's (URA) introduction of digital taxation measures targeting online traders and the mixed responses these measures have generated among the growing population of digital commerce practitioners. A cross-sectional survey design was employed, with data collected from 186 e-commerce traders through structured questionnaires. Descriptive statistics, Pearson correlation, and multiple linear regression analyses were applied. The findings revealed that digital tax compliance processes, digital tax awareness, and perceived digital tax fairness were significantly correlated with ecommerce growth. Regression analysis indicated that the model explained 58.9% of variance in e-commerce growth, with perceived digital tax fairness emerging as the strongest predictor. The study concludes that the design and communication of digital taxation frameworks critically shape e commerce growth trajectories among informal and semi-formal traders in urban Uganda. Recommendations are made for tax authority communications strategies, simplified compliance tools, and differentiated tax regimes for small-scale digital traders.