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Government bows to pressure, suspends direct social media tax

With the beginning of July 2018, Ugandans pay a tax of shs 200 to access social media platforms. Uganda Revenue Authority wants the tax bill reviewed and be embed on data transactions instead of charging it directly. (FILE PHOTO)

KAMPALA- In what appears like the latest move to succumb to demands of Ugandans, government has said telecoms must embed social media tax in data transactions instead of charging it directly as it is currently done.

Telecoms blocked social media access, requiring users to pay 200shs in tax to access such platforms.

However, according to Uganda Revenue Authority (URA), the implementation of the social media tax payment needs to be reviewed since, according to the Excise Duty Law, the tax is indirect and should be incorporated in the final price.

Mr Ian Rumanyika, the URA head of public and corporate affairs, earlier this week said; “Telecom companies should be benchmarking how to make sure it is not felt by the consumer.”

The method of implementation has since July 1, resulted into an uproar, which has since proven the tax extremely unpopular with many mobile phone users, who say it is unfair and stifles free speech.

However, sources revealed to PML Daily that senior government officials on Thursday held a strategy meeting in Kampala to devise ways of streamlining the procedure of paying the social media tax.

President Yoweri Museveni on Wednesday defended the controversial social media tax, saying social media is waste of money on foreign firms.

Social media users, he said, were “endlessly donating money to foreign telephone companies through chatting or even lying.”

“The social media users have no right to squander the dollars I earn from my coffee , my milk etc by endlessly donating money to foreign telephone Companies through chatting or even lying and, then, they are allergic to even a modest contribution to their country whose collective wealth they are misusing,” said Museveni in a statement on Wednesday.

The president described social media as a “luxury by those who are enjoying themselves or those who are malicious…all the moral reasons are in favor of that tax.”

There has also been anger over a new tax on all transactions on Mobile Money.

Museveni said there had been a “miscommunication” and that the levy would be 0.5 percent of the value of transactions, not 1 percent passed by parliament.

 

 

 

 

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