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
Onegi-Obel cleared of fraud in NSSF sh8b case
The Anti- Corruption Court has cleared the former board chairman of the National Social Security Fund(NSSF) Geoffrey Onegi Obel, of charges of abuse of office and causing financial loss in the acquisition of the sh8b Nsimbe Estates...
Brutalised baby admitted at Mulago Hospital
Eric Kamanzi and Angella Mbabazi, the parents of Aneela Kamanzi, the one-year old toddler has been admitted at the Paediatrics Acute Care Unit in Mulago Hospital for further checkup....
Sole candidature was imposed on Museveni - MP
The legislator says the resolution to field President Yoweri Museveni as the party’s sole candidate was imposed on him....
Police trying to verify Luzinda nude photos
Police seek the opinion of forensic experts to help verify the nude photos that are supposedly of musician Desire Luzinda....
Passengers get out and push frozen plane
A group of hardy Siberian oil workers stuck in a frozen plane took matters in their own hands - getting out to give the stranded jet a push....
Beggar arrested with millions in his pockets
A beggar arrested in Iran on Wednesday had millions of rials (millions of Ugandan shillings) in his pockets and a great deal more in two bank accounts....
Should Govt lease parts of Lake Victoria to private developers?
Its Ok
No Way
Not Sure
follow us
subscribe to our news letter