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Forget about mobile money refund! Ministry of finance officials defy Museveni directive to refund mobile money taxes

Finance minister Matia Kasaija (R) and PS  Keith Muhakanizi (C) before the probe committee recently. Finance Ministry confirmed that the collected money was used appropriately to the betterment of the nation (FILE PHOTO)

KAMPALA – The Ministry of Finance, Economic Planning and Development has made it clear to Ugandans to forget about the refund of the 1 percent Mobile Money tax as directed by President Yoweri Museveni in July.

According to Mr Keith Muhakanizi, the Permanent Secretary ministry of finance said the money was collected and spent legally on services to the Ugandans.

Muhanizi was speaking during a meeting where he also presented the 2nd quarter report of Government expenditure at the Ministry of Finance headquarters in Kampala on Friday

“The Ministry spent the Money on services enjoyed by Ugandans, there is no refund because it was also collected legally,” Muhakanizi said adding that the ministry followed the law.

At the beginning of July, this year, telecom companies were directed to start charging 1% on mobile money transactions including on withdrawals, sending, and deposits.

The mobile money tax had triggered a massive outcry in the country.

Consequently, on July 13, President Museveni in a statement ordered that Ugandans who paid the 1% per cent mobile money tax to be refunded as the 1% levy was passed by parliament and signed by him in error.

He also ordered the tax be reduced to 0.5 per cent and be charged on only withdrawals.

However, in the recent development, Ugandans are to begin paying the 0.5 per cent tax on mobile money transactions after Parliament on earlier this week passed the Excise Duty Amendment Bill (2018) No 2.

The contentious bill sailed through the House voting, in which 288 MPs out of the 463 MPs that constitute the 10th Parliament participated.

However, a section of the MPs including Ndorwa East MP Wilfred Nuwagaba had moved a motion, demanding that Clause 2 of Bill be deleted and the tax on mobile money transactions be entirely scrapped.

The voting then started by a show of arms where 136 MPs voted to support the tax while 101 opposed it.

Kyadondo East MP Robert Kyagulanyi alias Bobi Wine and Lira Municipality MP Jimmy Akena look on as legislators vote on the controversial 0.5% Mobile Money tax Tuesday, Oct 2(FILE PHOTO)

However, Deputy Speaker Jacob Oulanyah rejected this method, which he said was marred by irregularities.

In the end, 164 MPs voted in support of the tax while 124 voted against.

Telecom companies had also refused to adhere to Museveni’s directive saying

Mr Val Okecho, the MTN Uganda senior public relations officer recently told this website that they [telecom companies] only follow and Implement directives from responsible institutions but not politicians.

“Recall we only implement directives from URA [Uganda revenue authority] and MOFPED [Ministry of Finance, Economic Planning and Development]; and until the proposed changes are made to the excise duty (amendment) 2018 we continue to follow the earlier directives [charging the 1 percent]

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