Uganda will review a tax on the use of social media, the prime minister said Wednesday after a protest against the controversial measure was broken up by police firing live rounds and teargas into the air.
Prime Minister Ruhakana Rugunda told parliament that President Museveni had "encouraged further discussion" on the fiercely-contested levy.
"Government is now reviewing the taxes taking into consideration the concerns of the public" and an amended bill will be debated on July 19, said Rugunda.
Since the start of July, access to media such as WhatsApp, Facebook and Twitter, as well as dating sites Tinder and Grindr, have been blocked unless users pay a 200-shilling ($0.05, 0.04 euro) daily tax.
Museveni last week had defended the move, saying many citizens did not pay their taxes as they ought to, and should not "donate money to foreign companies through chatting or even lying" on social media.
In its current form, tax requires mobile internet users to input a code on their phones to pay the charge before they are able to access social media sites.
However, implementation has proved patchy and some blocked services are still available.
Some sites have turned to virtual private networks (VPNs) to disguise their location and avoid the levy, a trick learned during elections two years ago when the government tried to shut down social media.
Popular singer and parliamentarian Bobi Wine, real name Robert Kyagulanyi, whose election last year was fuelled by social media, has led the chorus of complaints against the tax.
He helped organise the rally on Wednesday, in which scores of people turned out defiantly dressed in red, a colour synonymous with protests against lifting the presidential age limit last year.
Protests do not often draw large crowds in Uganda, as they are often met by overwhelming force from police and military units.
As cracks from police guns echoed around the tightly packed buildings of central Kampala, bystanders rushed to angrily confront the police and shout their support for Bobi Wine.
Market vendors and motorcycle taxi drivers faced off against police in anti-riot gear, with some lobbing stones at the officers.
"Teargas was fired and some live ammunition was fired into the air to disperse the crowd," said police spokesman Luke Owoyesigire, adding two protesters had been arrested.
"During the unlawful procession officers had to act. Some of our officers were assaulted."
Police attempted to arrest Wine, but his supporters successfully defended him and he arrived at parliament.
"We set out to show our displeasure at the social media and mobile money taxes. We had informed the police of our intention to march and so we are dismayed at the use of brute force and live ammunition to break up a peaceful protest," said one of the organisers, television journalist Raymond Mujuni.
"It's not right. Our rights as citizens are being trampled upon."
Below is PM Rugunda’s statement in full;
STATEMENT TO PARLIAMENT BY THE RT.HON PRIME MINISTER ON THE RECENTLY INTRODUCED TAXES ON MOBILE MONEY TRANSACTIONS AND OVER THE TOP SERVICES (OTT)
Rt.Hon. Speaker I present this statement under rule 51 (1) of our rules of procedure.
Rt.Hon. Speaker and Hon.Colleagues, as you are all aware; there has been a lot of public discussion about the recently introduced taxes on Mobile Money transactions and Over the Top Services (OTT) commonly known as social media.
Rt.Hon. Speaker and Hon. Colleagues, the Excise Duty (Amendment) Bill 2018 was presented to this August House, debated and passed by this Parliament. It was subsequently assented to by His Excellency the President and consequently became an Act of Parliament.
The Act imposes a 1% Levy on receiving, payments and withdraws through mobile money platforms. In addition, it imposes a specific charge of Uganda Shillings (Shs.) 200 on over the top (OTT) services per day of access.
Rt.Hon.Speaker and Hon.Colleagues, since the Act came since the Act came into force on 1st July 2018; Government has noted public concerns regarding some of the elements in implementation of especially tax on mobile money transactions and OTT.
H.E. the President has provided guidance on the matter and encouraged further discussion with a view to reaching consensus on how we should raise the much needed revenue to finance our budget and undertake the development agenda we have set for ourselves without causing unbearable burden to the citizens.
Rt. Hon.Speaker and Hon. Colleagues,
Government is now reviewing the taxes taking into consideration the concerns of the public and its implications on the budget.
The review is being expedited to ensure that Government presents an Amendment of the Excise Duty (Amendment) Act 2018 to this House for debate on Thursday next week (19th July 2018) Hon. Members will therefore have the opportunity to debate and consult widely to guide Parliament during the consideration and debate of the Amendment Bill.
Rt Hon. Speaker and Hon Colleagues,
I would like to assure this Parliament that Government is committed to ensuring that the tax on mobile money and OTT are designed taking into account the public concerns and balancing the need to raise revenue to finance our development agenda.
I thank you
Ruhakana Rugunda (Dr)
Prime Minister/ Leader of Government Business
11th July 2018