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World Bank lauds Uganda on social media tax

World Bank senior economist for Uganda Richard Ancrum Walker says he is impressed with the public debate around proposed new taxes, including that on social media usage.

Addressing journalists in Kampala, Walker said that for long, public debate in Uganda has been about expenditures and not revenue mobilization. Walker said he is happy that this time, there has been a lot of public debate on the administration of revenues, which is crucial for Uganda.

Government is proposing Shs 100/day on social media 

In the tax proposals for the financial year 2018/19, government intends to introduce new taxes including among others, the Shs 100 daily tax on social media usage, one percent charge on every mobile money transaction and taxing of savings and credit cooperative organisations (Saccos), among others.

Uganda Revenue Authority (URA) also wants banks to furnish it with customer details as one way of generating revenues, although the president has since halted the move. Also on the cards is a proposal to tax each international call at Shs 330.

The new tax proposals especially the 'social media tax' have generated public uproar, with most voices opposing it as "double taxation" on grounds that such social media users already pay taxes on the airtime and data, as well as on the smartphones.

In FY 2016/17, URA collected Shs 13 trillion which is less than half of the national budget of Shs 29 trillion. In order to cover the deficit, the government has to borrow externally and domestically, as well as sourcing from development partners.

The implication is that the borrowing increases the debt burden, as more and more monies are used to repay the debt, including more borrowing. In the current budget, nearly Shs 3 trillion is for debt repayment.

Reacting to the World Bank stance, political economist Prof Julius Kiiza, of Makerere University, agrees that the increased focus and debate on different sources and nature of government revenues is healthy and encouraging.

According to Prof Kiiza, the debate should be deepened to include government's double standards of providing generous tax holidays for so-called investors, while, as he puts it, "squeezing the daylights out of ordinary businesses and citizens who are already struggling".

Prof Kiiza says even without proposing new revenue sources, the government is already losing so much in revenues to dubious investors who, in addition to benefiting from tax exemptions, also use offshore dealings to fleece the country of lots of money.

He says the debate on resource mobilisation must also focus on the citizens holding duty bearers accountable for every single coin they collect and spend.
                                                                                                                                                             
Writing in The Daily Monitor recently, economist Dr Fred Muhumuza of Makerere University, the new tax proposals are symptomatic of so much chaos in the country and that it is hard to determine what will happen when the proposed taxes take effect.
 
Dr Muhumuza wondered what could be the real intention behind the new taxes like the "WhatsApp" tax considering that such users are already taxed for buying airtime and data. He thinks the tax is more to do with curtailing freedom of information and expression.
 
According to Muhumuza, using the Internet is more of a production than a consumptive venture, and should be promoted.

Comments

+2 #1 kabayekka 2018-04-21 02:59
Well then if the World Bank has applauded the debate on heavy taxation on the citizens of this very indebted poor African country one is of the opinion that all the debts of this country must at once be written off for the second time.

One understands that to finish to pay all these accumulated international and national debts, it is going to take this poor country about 74 years of real cash repayement.
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+2 #2 Henry Baisi 2018-04-21 10:09
In Bukono, very few of us use social media anyway. Life is about survival.

80% of households own a 3-acre parcel of land which they use as the sole source of economic livelihood.

Generations are condemned to live a life of abject poverty. I know many people in this category.

The challenge is how do we get them to improve their lot? That is what I expect the World Bank Representative to address. Be relevant to society please IBRD!
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0 #3 WADADA rogers 2018-04-21 10:58
The taxes should be tripped
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+5 #4 Zaitun 2018-04-21 13:52
The govt. has become so broke that Museveni has almost nothing to steal from public coffers, hence the goverment's obsession with taxing social media.

This man, World Bank senior economist for Uganda Richard Ancrum Walker, I am sure, is happy because they have not only succeeded in their projetc to destroy everything in the country, but to make Ugandan social media users poor, hence stopping them criticising their friends, Museveni and co.

We have not forgotten that it was with the advice of World Bank and FMI that this stooge destroyed all what were meant for developping the country- Banks, Industries, Communication systems...

Where as they contribute daily to the development of other countries, their only attitude towards Ugandans is based on destruction and aggravated poverty.
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+4 #5 Jama 2018-04-21 13:54
Gorvnment should withdraw this tax from airtime companies, instead of milking the poor citizens,who struggle painfully to earn something.

Prof.Muhumuza is right, this could be another way of quelling freedom of expression.

Since there is no organ to control at institutional level,the.public.is not informed on how much the presidency, the gorvnment and Parliament spends.

Apart from the misuse of funds, corruption is one of the major factors crippling, the gorvnment's initiative for tax mobilisation.
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+1 #6 Akot 2018-04-22 18:54
kabayekka, thanks!

But world bank is not concerned about Ugandans & how they live as long as it gets it's share of the loot!

Above picture is so inhuman: 2 young women are together, but are each on phone & prefer being in contact with those not with them!!!

Where is humanity-friendship-going out with a friend & talk to...in picture above?

Why are they next to one another when their correspondents/friends they want to talk to are far away?
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0 #7 Akot 2018-04-22 19:05
Quoting Henry Baisi:
In Bukono, very few of us use social media anyway. Life is about survival.

80% of households own a 3-acre parcel of land which they use as the sole source of economic livelihood.

Generations are condemned to live a life of abject poverty. I know many people in this category.

The challenge is how do we get them to improve their lot? That is what I expect the World Bank Representative to address. Be relevant to society please IBRD!


Thanks!

World bank is happy museveni bleeds Ugandans dry & this should just continue!

Ugandans MUST UNITY to throw museveni & the entire tribalistic system out & stop every body from lauding the inhumanity going on while they share our riches with museveni & are happy 90% Ugandans are so poor!

World bank like UN flurshish on poverty of the defensless & would never want dictators-bad rulers out of power!
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0 #8 Akot 2018-04-22 19:09
Quoting Zaitun:


This man, World Bank senior economist for Uganda Richard Ancrum Walker, I am sure, is happy because they have not only succeeded in their projetc to destroy everything in the country, but to make Ugandan social media users poor, hence stopping them criticising their friends, Museveni and co.

We have not forgotten that it was with the advice of World Bank and FMI that this stooge destroyed all what were meant for developping the country- Banks, Industries, Communication systems...

Where as they contribute daily to the development of other countries, their only attitude towards Ugandans is based on destruction and aggravated poverty.


Thanks!

Why don't Ugandans UNITE & throw museveni out then go for the kind of governance they want & stop these demons help museveni destroy Ugandans completely?
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+1 #9 Akot 2018-04-22 19:17
Jama, agreed!

World bank is financed by badly ruled countries: once a people have no say, dictators-bad rulers do as they want & world bank-UN join these demons to make sure miserirs of millions continue while these inhuman bodies get their share & pray dictators-bad rulers goes on!

Ugandans have no choice but to UNITE & throw museveni & the entire system he put in place out: whether it will be Reformed Republic or Independent Tribal States, the entire zone will be controled by Ugandans & not world bank nor foreigners while Ugandans have no say & go poor on their rich land!
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