The Excise Duty (Amendment) Act, 2018 that was approved by parliament last month slapped taxes on Mobile Money and OTT services. However, two taxes have set online platforms ablaze with continued debates about government’s rationale to impose a levy.
The public advocated for further adjustments of the Excise duty bill. These included correction of the erroneous 1% tax on withdrawals to 0.5%. Also, a tax on deposits getting scrapped off and those that were charged 1% tax getting a refund.
However, Deputy Speaker Jacob Oulanya sent it to the finance committee, which currently requires reconstitution for further scrutiny. Highlighting the urgency of the bill, Roland Mugume (Rukungiri Municipality) attempted to have the decision reversed. However, Oulanya ruled that: “Committees are in place, it is the members that are not there. We shall deal with the Bill once we constitute membership.”
In his communication, Oulanya revealed that Parliament has been receiving numerous petitions all expressing concern over the new taxes. However, he added that the finance committee (which apparently has no members) should handle all these.
Students and Researchers exempted from OTT Tax.
While the Mobile Money Tax will see a reduction to 0.5%, Government will maintain the UGX 200 OTT Tax. However, the tax will exempt students and researchers.
So how will government pull this off? NRM caucus deputy chairperson Solomon Silwany said: “They will register with the institutions they are studying and these institutions will notify the Government.”
Most arguments against the OTT Tax revolved around stifling research and innovation. Whereas the Government seems to fully to recognize that, its main focus is to raise the much-needed funds, and well, curb ‘lugambo’.
It’s not yet clear who the government considers a ‘student’. Is it from secondary level all the way to universities? How about primary school kids? We shall avail this information as soon as we get it.
However, the Government insists that the UGX 200 tax is not a tax on internet, but rather one on social media.
