Mixed reactions as 0.5% mobile money tax is effected

Mobile money dealers and customers yesterday expressed mixed feelings following a Friday Excise Duty (Amendment) (No.2) Act, 2018 gazettement.
Publishing the Act meant effecting mobile money transactions tax to 0.5 per cent as opposed to 1 per cent that was previously charged.
Ms Angel Nalubega, a mobile money dealer in Namuwongo, a Kampala suburb said despite reduction on mobile money tax, “customers are not transacting as was before the tax was introduced,”

“If a customer is to send Shs1 million to someone in town, s/he will rather use a boda boda than paying that tax,” Ms Nalubega said, adding, “My hope is that this tax is scrapped off altogether.”
For Ms Raina Salama there was a small improvement in transactions yesterday compared to previous week, but she was unable to attribute it to either tax reduction or “luck”
“Business is slowly coming back,” Ms Salama, a mobile money operator in Namuwongo said.

Mr George Were, a dealer in Kibuli, said there is a “slight increase in transaction” and he is hopeful that with increased awareness about the tax reduction, he will be in business.

We are not aware of incentives - SMEs

Lack of business information is limiting the growth of Agro-based Small and Medium Enterprises (SMEs) in Fort Portal.
Small scale entrepreneurs gathered in Fort Portal town to discuss their grievances at the invitation of Southern and Eastern African Trade Information and Negotiations Institute (SEATINI) Uganda in partnership with Uganda Small Scale Industries Association recently.

Key concerns raised by the young businesses were lack of certification from Uganda National Bureau of Standards (UNBS).
Mr Francis Tinka, a wine producer from Rwenzori Community Centre Organisation, expressed his interest in supplying wine to supermarkets around the region but lacks certification from UNBS.

Certification with the quality mark, which often is a prerequisite for supplying in supermarkets costs Shs800,000 per product, a price he cannot bear.

Mr Tinka was not aware that UNBS recently reduced the price of certification to Shs125,000.

Kadaga summons Finance Minister to explain mobile money tax implementation

Parliament has summoned the Ministry of Finance to explain why the Excise Duty Act assented to by president Museveni to reduce the mobile money tax from 1 percent to 0.5 percent is not yet in force.

This followed a complaint by Nakaseke South MP, Ssemakula Luttamaguzi that telecom companies are still charging the 1 percent tax on all transactions despite the new law being in place.

“The lawful charges should be 0.5 percent but up to now telecom companies are still charging one percent. We want to know because most of the people dealing in mobile money have fallen out of that business. Is it designed by government to kill its own people or it is an accident?” he questioned.
He added; “It is a matter of gazetting. We have seen MPs like former Rubaga South Singh Katongole was gazetted within hours but why is such an issue affecting majority of Ugandans taking so long to be gazette?”

Speaker of Parliament Rebecca Kadaga at this point demanded that the Minister of Finance reports to Parliament to explain his arrangements to enforce the excise duty tax.