Govt to spend Shs500 billion on monitoring social media tax

Govt to spend Shs500 billion on monitoring social media tax
Eazzy Banking

Government has announced it will come up with a system that will require all social media sites operating in Uganda to pay tax to the state.

Addressing journalists at Uganda Media Centre, Minister in charge of Economic Planning David Bahati says Shs500 billion has been set aside to put in place a monitoring system.

He reveals that the social media sites such as Twitter, Facebook, Instagram among others will be approached and asked to pay taxes on profits they make through advertisements.

Bahati was calling upon Ugandans to embrace the Shs200 daily levy on social media and the one percent excise duty tax on all mobile money transactions.

There has been a public uproar since Sunday when the taxes came into effect.

Bahati noted that government is engaging telecommunication companies to come up with a better option to pay the social media tax instead of using mobile money.

Government has long had an issue with social media as it tries to keep tabs on its young population. Back in February 2016, the country’s telecoms regulator blocked the internet during elections, ostensibly for security purposes. This year, the regulator proposed a tax on social-media use, designed to curb gossip online and raise billions of shillings in government revenue. That levy came after president Yoweri Museveni complained that idle talk on social media was costing the country much-needed time and income.

Internet penetration stands at just 22% in Uganda, according to the World Bank. Social networks constitute the internet for those already online, with Facebook, WhatsApp, and Twitter being the most popular apps.

The new fee is expected to impact usage of social media and mobile money, which now has an additional 1% tax.

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