James Mubi, the police spokesperson for Busoga East Region, told Xinhua that the fatal accident involved a passenger commuter taxi and a bus at Busembatia along the Iganga-Mbale Highway.
The police said all the deceased passengers were in the commuter taxi while those in the bus are safe.
"The driver of the commuter taxi was attempting to overtake the bus before ramming into it," said Mubi.
The police spokesperson urged drivers to avoid speeding, reckless driving and overtaking, especially in corners.
Uganda registers about 20,000 accidents each year, with some 2,000 deaths, making it one of the countries with the highest road traffic death rates, according to police statistics.