Government criticized over mobile money tax

By Samuel Ssebuliba

Parliament has been criticized for passing the controversial taxes on mobile money transactions and social media use.

The Excise Duty Amendment Act of 2018 was passed yesterday amid strong protest from some Members of Parliament.

The new law will impose a mandatory Shs200 daily levy for WhatsApp users starting July 1st, while mobile money services will also attract a 1% levy on the total value of the transaction.

However some members including the leader of Opposition in parliament Winne Kiiza and Kyadondo East’s Robert Kyagulanyi said Ugandans are already being taxed on salaries and other forms of income and so it is not prudent to tax money transfers.

He says this move is likely to affect growth of financial inclusion and many people are likely to degenerate back to informal ways of transferring money.

The Excise Duty Amendment Act, 2018 also extends to the kitchen, with cooking oil facing a Shs200 levy on every litre.

Regarding the Shs200 daily levy for WhatsApp, the state minister for finance in charge of planning David Bahati told parliament on Wednesday evening that government is not taxing data or internet but rather just the service.

He said that with only Shs200 charge per day, each consistent WhatsApp user will pay only Shs 73,000 in one year.