today's Pick
Finance rejects sh3000 tax on mobile phone lines
Publish Date: May 04, 2014
Finance rejects sh3000 tax on mobile phone lines
  • mail
  • img
newvision

By Mary Karugaba

The Ministry of Finance has rejected a proposal by MPs to impose a user fee of sh3000 on every mobile phone line per year. The amount will also depend on the number of telephone lines one has.


The proposal by MPs on the Parliamentary Finance Committee is intended to streamline tax expenditure, tax policy and administration to raise tax efforts.

The proposal was forwarded to the Ministry of Finance for consideration, come next financial year.

“Most donors have indicated that they are pulling out of the budget support next financial year. So are trying to find possible means of raising our sources of revenues so that the population is not affected in terms of service delivery,” MP Lilly Adong argued.

Without proposing a figure, the MPs also called for a higher levy on night clubs.

But State Minister of Finance Fred Omach rejected the proposal arguing that there were already taxes on phones.

Omach argued that any additional tax would make the service less competitive and more costly.

“They are already a number of charges on mobile phones. The proposal to impose an additional user fee of sh3000 will make the service more costly and less competitive,” he said.

It’s becoming almost a tradition that every financial year, there’s a new tax introduced on mobile phones.

Currently, Ugandan mobile phone users pay a VAT of 18% and excise duty of 12 %. In addition, VAT is levied on handsets and exercise duty of $9 cents on international incoming calls.

The minister of Finance Maria Kiwanuka announced last month during a Caucus meeting at Entebbe that Uganda will be funding the coming year's budget largely from domestic revenue sources by 82 %.

This is in sharp contrast from last year when as much as 25 per-cent of the budget was donor funded. The aid cut follows donors’ concerns following theft of public funds.

Finance commissioner for Tax, Moses Kagwa told Newvision that although the ministry has looked at the proposal, it is not applicable. He doubted whether the MPs first did a research on the impact of the charge on consumers.

Adding that, “I think the proposal was not properly researched to ascertain its impact on consumers.”

Some mobile phone companies could not comment as their spokespersons were either out of the country or not available on weekends.

The statements, comments, or opinions expressed through the use of New Vision Online are those of their respective authors, who are solely responsible for them, and do not necessarily represent the views held by the staff and management of New Vision Online.

New Vision Online reserves the right to moderate, publish or delete a post without warning or consultation with the author.Find out why we moderate comments. For any questions please contact digital@newvision.co.ug

  • mail
  • img
blog comments powered by Disqus
Also In This Section
I am not grooming my son for presidency
That is an insult. Why should I groom my son? This is not a monarchy; this is not a feudal arrangement. It is a democratic order....
UN in South Sudan sees possible deal but no peace
The UN mission in South Sudan is bracing for ongoing fighting even if a political deal is reached between rival leaders, the new head of mission said Wednesday....
Wives not cows: Uganda dowry fuels domestic violence
When Ugandan farmer''s daughter Rose Akurut became engaged to a man from a village far from her own, her parents could not be more thrilled....
Britain's Houses of Parliament desperately need some feline protection to tackle the growing mouse population - but the job would require an impractical number of cats prowling the corridors of power....
Besigye thrown out of Masaka workshop
FORMER FDC leader, Col Kizza Besigye was thrown out of a conference on free and fair elections at Hotel Brovad in Masaka on grounds that he was not officially invited...
South Sudan women suggest sex strike to end war
A group of South Sudanese women peace activists has suggested that men in the civil war-torn country be denied sex...
Should diplomatic passports issued to ex-govt workers be with drawn?
Yes
No
Can't Say
follow us
subscribe to our news letter