Reintroduction of annual car license is counterproductive
April 8, 2021 A Shs 200,000 annual tax has been proposed for all vehicles
There are new tax proposals for the next financial year that have caught the eyes of many. One is the introduction of a 12 per cent tax on internet bundles.
Apparently, the Over-The-Top (OTT) tax charged on social media isn’t that successful. Either the number of people who use social media had been exaggerated before the tax was introduced or there are many people using Virtual Private Networks (VPNs) to bypass the tax.
But I guess everyone who is in the business of tax collection knows that for one to realize significant revenues, it must be easy for people to collect the tax in the first place. Once a tax is cumbersome to collect, the collector will face serious hurdles in doing their work. Also, people will naturally use such hurdles to dodge paying the tax.
Government To Drop OTT Levy To Tax Internet Bundles Instead
Government To Drop OTT Levy To Tax Internet Bundles Instead
The tax on internet bundles is one of the seven new taxes that the Ugandan government wants to apply from July 1st, 2021 when the next financial year starts, should Members of Parliament approve it.
Pictured a person using internet to access a web page on Google. Photo by: Humphrey Mpairwe
The Ugandan government plans to impose a 12 percent levy on internet bundles as they plan to drop the levy on Over-The-Top (OTT) service which revenue-tax body the Uganda Revenue Authority (URA) said had yielded less-than-expected revenue. The OTT levy has been performing poorly due to users opting to use Virtual Private Networks (VPNs) and Wi-Fi, thus the proposition to drop the tax and instead tax internet bundles.
Daily Monitor
Friday April 02 2021
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The government has proposed to abolish the payment of Over the Top Services (OTT) under the Excise Duty (Amendment) Bill, 2021.
The Bill scheduled for tabling on the floor of Parliament on Thursday by the Minister of Finance Matia Kasaija also proposes the re-introduction of excise duty at a rate of 12 percent on internet data.
However according to audit firm- PricewaterhouseCoopers, the Bill proposes exclusion for data used for the provision of medical and education services.
The Over the Top Services (OTT) or social media tax was first introduced in 2018 and caused a nationwide uproar and protests led by Kyadondo East MP Robert Kyagulanyi. Sections of the public then demanded a reconsideration of the Excise Duty (Amendment) Act, 2018 with a view of removing the Shs200 over the Top (OTT) tax that came into effect on July 1, 2018.