There are sometimes you wished the government did their due diligence, even though it true, before levying taxes like the Social Media Tax. That can now be questioned and that with force as well, becasuse the Minister for ICT Frank Tumwebaze tried to defend the new taxes, but it is seriously flawed. First I let him argue and defend, before I address the matter.
“While Ugandans rightly argue that government should be taxing OTTs such as Facebook, the Minister noted that these ignore the applicability of this. “Internet Service Providers such as MTN and Airtel are licensed by UCC; they pay taxes and have invested heavily in building networks. But OTTS come and freely push content here using the existing networks; they contribute nothing to the building of the networks; they just get their money and go away,” he explained. “The debate therefore should be on how to capture OTTS to contribute to expanding of local networks and sustaining them.” “Even if government targeted Facebook, and said we are going to block the Facebook gateway if they don’t pay to URA; the same (public) uproar will come because we are blocking social media.” (Waswa, 2018).
They are literally blocking the Social Media as of today. That with a paywall through the existing Mobile Networks to access Social Media. Therefore, he is letting the people take the burden and not the companies. He talks about the content and service delivery, but the ones hurt is the people. The users/citizens use the Social Media who pays the OTT Tax. The tax is not on the Social Media Companies nor the Telecom Companies; that is just the fact and should be a concern for the minister.
Therefore, even with the tax at hand, the public is paying the taxman, not the ones putting forward the products through the Mobile Networks or Online. That is why the argument of Tumwebaze is flawed. He is missing one key ingredient, and that should be stated. It is not the companies that are paying these levied taxes, it is the users or the citizens themselves. That means, whatever the companies does, they are shielded, because they are not directly paying the levied tax.
The honourable Minister is losing on two grounds:
By putting up a paywall, he is blocking the ones that cannot afford to communicate through the Social Media.
Secondly, he is by definition not taxing the companies, but the users of these companies.
Therefore, he should go back to the drawing board and find other crayons, because the colouring of the Picture, he is doing right now is to be a bit blunt, ugly. Peace.
Waswa, Sam – ‘Tumwebaze Explains Social Media Predicament: ‘There’s No Way of Taxing OTT Companies’ (04.07.2018) link: https://chimpreports.com/tumwebaze-explains-social-media-predicament-theres-no-way-of-taxing-ott-companies/