Ugandan President Yoweri Museveni mentioned taxing social media services in early April. His reasoning for this was to curb online gossip. Referred to as ‘Lugambo’ by the locals. The Ugandan people were not sure if he was serious until the Excise Duty Amendment Bill of 2018 was passed by parliament. This included taxing of all social media usage. Not only that, but it also includes taxing mobile money transactions.
Now Ugandans have to pay a cost of 200 Ugandan shillings to access social media a day. These taxes cover all social media including the very popular WhatsApp. WhatsApp has become the first option for communication by millennials and the older generation today. Families, social groups, and friendship are connected via WhatsApp. Although Uganda does not have a very high internet penetration, the opposition claims it shall slow down the flow of communication. More than that, the new taxes shall also slow down the digital infrastructure in the country.
Internet penetration in Uganda stands at 31% as at the end of 2017. The government, however, is not budging. The law is effective from 1st of July and claims it shall broaden the tax base and increase revenue. Hon. David Bahati, Minister for Finance Planning stated that the tax is not for data bundles but the social media services. As a result, should a person need to use it, they should pay the required fees. This news comes shortly after the Uganda Communications Commission banned the use of scratch cards.
This fresh policy requires Ugandans to buy airtime using electronic services. This puts more pressure on Ugandans financially. The opposition cited the negative effects of the new laws on the poor, but the government did not empathize. Members of parliament agreed upon the new law with Hon. Bahati remarking “The poor want free healthcare, free education, and roads among other things. Therefore, they should respond with the same appetite to pay taxes.