Why universities are pushing for tax waiver on ICT gadgets

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Uganda Revenue Authority (URA) commissioner general, John Musinguzi Rujoki, has pledged to support educational institutions in their bid for affordable ICT equipment used in education dissemination.

Musinguzi said his entity will make recommendations to the government for policy changes in taxation. This is aimed at bridging the country’s digital divide in the face of emerging technologies such as artificial intelligence (AI) and robotics.

“What it requires is policy change; we will make recommendations to the government, and it can make these proposals to parliament to put in place enabling laws,” he said while presiding over the launch of an artificial intelligence and robotics laboratory at ISBAT University's main campus on Thursday, April 3, 2025.

Musinguzi (centre) with ISBAT chairman, Varghese Mundamattam (right), and the university's vice chancellor, Prof. Matthew Kalmatacal and Chancellor Jachan Omach (second left). (Credit: Vivien Nakitende)

The commissioner general’s revelation came as ISBAT University chairman, Varghese Mundamattam, raised the issue of the high tariffs in importing the equipment, arguing that this is putting off many institutions. For example, he said the university could not bring in specialized equipment to enrich the lab because it failed in its attempt to negotiate exemptions on some robotic gadgets, yet this would have helped enrich robotics teaching in the country.   

“There is no doubt that this is a mission worth supporting, only that we have to follow that kind of process [working with parliament],” Musinguzi said.

He added that as a tax body their role is to implement what is approved in tax laws.

URA commissioner general, John Musinguzi (right), with ISBAT chairman (left) and chancellor Jachan Omach, during the launch of an AI and Robotics lab at ISBAT on Thursday, April 3, 2025. (Credit: Vivien Nakitende)

Digital gadgets

Currently, over 90 per cent of digital gadgets used in Uganda are imported, and many attract taxes that amount to over 30 per cent of their value. Among the taxes paid on electronics such as smartphones are 18 per cent value-added tax, 10 per cent import duty and 1.5 per cent infrastructure tax, among others. Apart from the physical electronic devices, the government also taxes digital services such as mobile money, where there is a 0.5 per cent tax on all withdrawals.

However, last financial year, the government reduced the cost of the internet by half from $70 (about sh255,000) to $35 (about sh127,000) per mbps per month. Experts say this is still high compared to North America and Asia Pacific, where it is below $5 (about sh18,211)

The university’s chancellor, Jachan Omach, who is also the former state minister of finance (general duties), said the high cost of technology equipment is of concern with the rapidly advancing technology which calls for the higher education learning institutions to adapt to the changing landscape of emerging technologies, including AI to make learning more relevant to the job market.

“Where we have reached with the world now, Ugandans must not be left behind, and you don’t have to go outside to get this kind of training,” he said.