Mobile money tax collections in Uganda generated a whooping Shs50 billion surplus in the first half of the financial year 2018/19, further validating the government’s decision to levy the tax Ugandans opposed.
The Uganda Revenue Authority (URA) says Shs104.75 billion was collected from mobile money tax in the period between July 2018 and December 2018 against initial target of Shs54 billion.
Vincent Seruma, the URA Assistant Commissioner for public and corporate affairs, attributed the surplus to the fact that mobile money continues to be a routine for many transactions in Uganda thus providing the “base for the proper collection of the levy”.
Initially, the mobile money levy had been implemented at 1 per cent but was in November reviewed by Parliament to 0.5 per cent. However, collections from Over the Top (OTT) tax, also known as social media tax, performed dismally with URA collecting only Shs21.12 billion in the same period against a target of Shs135.21 billion.
The poor performance of OTT, according to Mr. Seruma, was largely because of “the use of alternative means to access social media”.
Such alternatives, he said, included corporate provided Internet or hot spots which are not subjected to OTT and Virtual Private Networks (VPNs). As a result, OTT registered a deficit of Shs114.09 billion for the period running from July to December.