Minister of ICT and National Guidance, Hon Frank Tumwebaze at the Blockchain Conference 2018. Stanbic Bank UG
Stanbic Bank UG

The Ugandan government on Tuesday said it will not scrap the recently introduced taxes on social media use and mobile money transfers in spite of public protest.

Frank Tumwebaze, Uganda’s minister of information, told newsmen that Cabinet on Monday decided that the daily rate of 200 shillings (0.05 U.S. dollars) charged on the usage of social media would stay.

He also said that the mobile money tax will be reduced from one per cent to 0.5 per cent.

The tax will only apply on withdrawals made.

The taxes triggered protests led by activists, media practitioners and parliamentarians resulting in further consultations between parliament and the government.

Tumwebaze clarified that those who use their mobile phones to pay utility bills and schools fees would not be charged any tax. He also said the Over The Top (OTT) tax, dubbed “social media” tax does not apply to other internet services such as sending emails.

David Bahati, minister of state for finance, planning and economic development who also attended the briefing, said the government is targeting to collect about 32 million U.S. dollars from the 10 million social users in the country annually.

“We want to get more options so that you can pay the social media tax quarterly or annually instead of the daily, weekly and monthly subscriptions,” Bahati said.

Telecommunication companies on July 1 started enforcing the excise duty charge on OTT and the levy on mobile money transactions.

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