Telecoms drop tax on mobile money deposits

Kampala. Telecoms have dropped tax on mobile money deposits, even as no official communication has been issued to explain the move.
However, they maintained the 1 per cent tax on withdrawals and bills payment contrary to President Museveni’s clarification.
Las week President Museveni said there was a miscommunication, clarifying that Cabinet had only agreed on 0.5 per cent and not 1 per cent.
Ian Rumanyika, the Uganda Revenue Authority (URA) public and corporate affairs manager, yesterday told Daily Monitor they would maintain the 1 per cent tax on mobile money pending a review of the 2018/19 tax amendments by Parliament.

The review, he said last week, will seek to harmonise a number of positions, among which, include the revision of the method of charging social media tax and the rate of tax on mobile money.
“There is an ongoing discussion so we await that discussion from Parliament. The law will guide on the process. It is only Parliament that has the power to amend the law,” he said.
However, no official communication had been issued to explain why telecoms were no longer charging the 1 per cent tax on mobile money deposits.

A simple survey conducted by Daily Monitor reported that a number of customers had not been charged for deposits.
Asked whether telecoms would refund the 1 per cent tax already charged from customers, Mr Rumanyika said that would be a decision of Parliament.
“Parliament will guide on what to do, because even when they reduce to 0.5, some people have already paid the 1 per cent,” he said.
President Museveni last week said it was a miscommunication to institute the 1 per cent tax on mobile money deposits.
However, a number of customers had already been charged, following its implantation on July 1.
Telecoms yesterday said they were yet to get an official communication from URA.

Last week Mr Rumanyika had indicated that there had been a number of engagements, which among them sought to embed social media tax in data transactions and implementing the 0.5 per cent modification.
Ms Sumin Namaganda, the Airtel public relations manager, yesterday said they will wait for written directives from URA to determine whether the tax charged before the president’s directive will be refunded or not.
‘This is URA jurisdiction, we implement as advised. Since everything is happening so fast, we are waiting for URA to tell us what to do. We are only implementers, it is not our money. If they say we pay back, we shall pay back. Whatever they say is what we do,” she said.
Mr Edgar Karamagi, the Africell public relations manager, said they would not comment on the matter, pending communications from URA.
We could not get a clarification from MTN as phone calls to different officials from the telecom went unanswered by press time.

President intervenes

Kicking up a storm. On July 1, telecoms implemented the 1 per cent mobile money tax on every transaction, kicking up a storm among a number of subscribers.
However, President Museveni quickly intervened, saying there had been a miscommunication.
He said Cabinet had only agreed on 0.5 per cent and not 1 per cent.
However, a number of people have questioned this line given that the President had signed the same adjustments, which had been severally referred to during the Budget reading, which he also attended.
A number of civil society organisations, media and individuals had for months questioned the same tax before it had been passed by Parliament.

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