The Shs200 excise tax that parliament passed last week on airtime/data in the financial year 2018/19 is unfair to the poor Ugandans, activists from Twaweza East Africa, a local civil society organisation have said.
Last week parliament passed the Shs200 tax to be paid per day by airtime/data buyers, meaning a client of telecom company will be paying Shs6000 monthly, assuming he loads airtime/data on the daily basis.
The tax is likely to see many of the poor Ugandans spend less time on social media platforms like Facebook, Whatsapp and Twitter among others.
In their analysis, they say that if the average monthly spending on airtime is about Shs10, 000, new tax would make up 60 per cent of that amount.
The activists are bitter that the richest would pay 30 per cent which would half that of the average Ugandan. They say the tax is regressive.
The activists in their report suggest that the new proposed tax on social media be reduced or changed into a tax based on usage, rather than leaving it as a flat tax that benefits the rich at the expensive of the poor.
They say women and the poor who spend less on airtime/data would be the most affected.
However, they say most people will adapt in both ways – “spending a bit more, but getting a bit less airtime for their money. “
“If the tax is to be applied to those that only use the social media, the effect will still be most felt by the women and the youth,” the say.
About 40 per cent of Uganda’s 40 million people use the internet, according to data from the Uganda Communications Commission which regulates the telecommunications industry in the country.