Telecommunications, Mobile Money and Cooking-Oil is hit by new taxes in Uganda!
You know there fiscal problems within the Government of Uganda (GoU). The GoU is on the rocks, as they are establishing more loans, more interests to pay and has leveraged their forex exchange, when they are levying today’s amount of new taxes. This is coming as reports of lacking hiring for the Civil Service, The Ministry of Public Service has suspended hiring of new positions in the districts and at the government institutions. This is happening, as the amount of cronies around the President is growing. Therefore, the wastage of funds are in and around the President, who can pledge funds as he wishes and give Presidential Handshakes to whoever he likes or needs. Therefore, today is sad day for transparency, as the state is eating itself, but not taking care of the needed services.
We know the state is poor, when the lacking banking-service and with the need of Mobile Money and Airtime on the Cellphones are getting hit by a tax. This is not social media tax, but is that the subscriber and user of the services, will get a withholding tax of 10% on transactions on Mobile Money and Airtime. This means, every time a Ugandan or someone buys airtime, in the price they are paying an added 10 % on the total price of the usage of minutes of airtime or making the transaction of funds between two funds more costly. This is really hitting the breadwinners and the ones who are servicing mobile money from the towns to villages.
Just to prove to how much the added cost on the Mobile Money is wished, as the withholding tax, they are adding direct also the excise tax on this from 10% to 15%, that means the added is 5% more on each transaction. If that isn’t excessive, just think about the two other taxes as well. Therefore, the state has added three taxes on using the phones. The citizens will have to plan more transactions, as they are more costly and will be less transactions of the amount, since the tax will shave off the amount of shillings sent to the fellow they wanted to give needed money through these services.
They are adding even more on every telecommunication services, not just the hit of withholding tax on it, but they are even adding an excise duty on it as well, meaning there are two pieces of taxes put on the same services, but at different times. Making the expenses of using the cellphones, hitting the roof and the value of the airtime dwindles, as you are paying more tax on each minute use. This excise duty is put on the level of 12% as well. So, expect the prices on airtime to rocket, as this hit both the agents to pay more tax on each, and also the cost of actually calling too. This is funds that the Telecommunication Companies will get back from the consumer, meaning citizens will pay more being in touch.
As they continue to give price hikes on necessities, they are putting a levy of 200shs on each liter of cooking oil, this meanings the price for making rollex or banana-pancakes will go up. Since before you buy the eggs and the flour to make your dish. You will pay more for each bottle, while the state gets simple taxation on this single item. It might seems pointless, but all fried foods will be more costly to make and a Samosa will cost more to make, therefore, expect a price hike on the hawkers foods in any stage where you waiting.
These are just some of the measures done by the state, there are several more, but this is really hitting the average citizen usage of phones and also cooking. This are just two items on a long lists of new taxes put on the people. Clearly, the state see the need for spikes of prices, growing inflation and lack of monetary control to come, as the chickens come to roost and the costs of debt services is hitting the fan.
The ones that has to pay for that, isn’t the elite, but all of the citizens who spends time outside their homes and buys into services. Which, means all of them. Peace.