Parliament orders assessment of impact of OTT tax

By Samuel Ssebuliba

Parliament’s committee on Information and Communication Technology has ordered the ministry of ICT to conduct an assessment on the impact of the social media tax that was introduced by government at the beginning of the financial year 2018/19.

The committee chaired by Annet Nyakecho said Over The Top tax seems to negatively affect the consumption of ICT services and products.

In response, ICT and National Guidance minister Frank Tumwebaze has admitted that the tax is has adverse effects on the sector, saying they were hoodwinked by his finance counterparts on the pretext that it was to increase revenue collections.

One month after its introduction, Uganda Revenue Authority collected Shs4.7billion  from the social media tax and Shs 22.3 billion from Mobile Money transactions.

The taxes were part of the new measures that came into effect at the beginning of the 2018-2019 financial year. Subscribers are charged a daily fee of Shs.200  to access social media sites like Facebook, Twitter, WhatsApp and Instagram, while 0.5 percent is charged from each mobile money transaction.