Yep, the biggest bank and the Bretton Woods Organization called the World Bank has commended the works of President Yoweri Kaguta Museveni and his plans for added taxes. That comes from the similar institution like International Monetary Fund, that ordered Uganda to follow the Structural Adjustment Plan (SAP), therefore, the IMF that fixed more privatization without lacking investments. Are now okaying a higher rising taxes on the Republic’s citizens. This is done, while the economy is not strengthen, but with added external and internal loans. Therefore, the rise of GDP and use of loans, as well as repayments on those loans will sooner or later hurt the economy. Even with the rise of taxes. This will be start of vicious cycle where the state is issuing loans and taxes, while the revenue is used to repay loans, not development. It is basically. But before I go into the deep of the part of the troubling take from the World Bank. Let me just show you quickly the result of the SAP and their advice there.
“The studies also make it clear that for SAP-type policies to have a chance of success, certain preconditions are necessary. The public sector had certain social responsibilities that the current framework has pushed it out of but without “a proper handing over” to the private sector. The assumption and hope were that the market would fill the gap left by the retreating state. Clearly this has not happened. There is therefore need for Government either to retain certain key social sectors, or only hand them over to the private sector only when the latter is ready to effectively take them over. Clearly non-profit making aspects of social responsibility cannot and do not get taken over by the private sector. For poverty to be reduced there are certain social responsibilities or even whole sectors that can only effectively be handled by the public sector. Welfare systems and subsidies to farmers in the developed world attest to the need for the retention of these key areas by the public sector. Therefore a policy that proscribes such a hand-over must also ensure that it is done in a verifiable manner so that the private sector can be held to account. Civil society has in the past tried to fill the gap but this has been done in an ad hoc manner” (Kevin Akoyi Makokha – ‘STRUCTURAL ADJUSTMENT PARTICIPATORY REVIEW INITIATIVE (SAPRI) – UGANDA COUNTRY REPORT: A synthesis of the Four SAPRI Studies’ September 2001).
So, when the last system from the World Bank and IMF was introduced the system and the government wasn’t ready to privatize, however, that didn’t stop them or the government to do so. Especially since the funds and loans at the time came with the hitch of doing so. Therefore, the troubles with the privatization and the lacking oversight is also partly because of these programs subsidized by these organizations. That is why the World Bank and IMF should be more careful professing what sort of thing would be genuine and sincere, since they have messed up before. It isn’t only the State House who has messed up, he has gotten help and followed the procedures of these mechanisms. If not, he wouldn’t be able to eat such vast amounts of donor funding in the past. This is well-known, but the lack of oversight, is because of the will of wanting to have control and a say in everything. That is why the letter from the President to Minister of Finance, is the reason for the new levied taxes. So, if you wonder why I have distrust to the World Bank and IMF, it is because of their history and that the public is paying for it, because their impact on the governments for the reasons. That these states should be guinea-pigs for the economy belief of trickling down economics, even as the results has begged differ if it really drips back into the system again. Which it doesn’t because the ones that gets a lot want to keep it and get some more. No dole it out to anyone they can find.
Here is what the World Bank stated today: “In the special section of the Update, the report analyses how Uganda could raise more domestic revenues to support its development. Uganda’s tax system is one of the most modern in the region, but revenue collections, at 14 percent of GDP, are low, and way below its tax potential. Tax avoidance and evasion, partly resulting from generous tax exemptions to investors, weak tax administration, and a large informal sector (now at 80 percent), pose challenges to increasing revenues. Up to 5 percent of GDP is lost annually in tax leakages. Personal income tax contributes roughly 18 percent of GDP compared to up to 40 percent in developed countries. VAT collections amount to 4 percent of GDP, but would rise to 6 percent if there were no exemptions. The report suggests that Uganda could widen its tax base by tapping into areas that are outside the tax net; applying tax instruments correctly and fairly; improving efficiency, transparency and accountability in tax administration; and delivering better public services” (World Bank – ‘Improving Taxation to Finance Uganda’s Development’ 15.05.2018).
Therefore, the World Bank likes the idea of adding more tax on the Mobile Money transactions and the movement of digital cash, as well as on Airtime and other needed things. The ones that hasn’t a bank-account or the ability to fund or even try to get a loans from the banking system. Are okayed by the World Bank as possible targets for taxes. This isn’t transparent, but making it more expensive to be poor, as the rates to transmit and the use mobile money will come. The companies whose use this method will bill the users, they will not take the hit. The same with all the traders and the importers of all the other items that was on the lists of the newly taxed items.
I doubt these new taxes will do any good, it will just be more funds for the elites, the NRM and the President to eat. They are not delivering government services with the trillions of shillings they are using now. They are billing up to their asses and spending rampant, without having the revenue. That is why the rising debts are there. Instead of living frugal and thinking of the future, the NRM and President Museveni are eating like there is no tomorrow!
State House, the President and the Cabinet are eating heavy, they are not delivering, they have no plans to do so. If so, they give locally when needed, but the lack of transparency and accountability, is the reason for missing funds. Recently even the documents from the GAVI Funds was taken from the Ministry of Health. Therefore, a government who cannot be trusted with funds giving donations to help the sick, how can we believe the tax put on Mobile Money will go to roads or teachers?
I doubt that, I am not that naive, this NRM has proven for 32 years, that they are eating and not caring. The World Bank can commend and praise. While I condemn, until they prove that they money are delivered to the schools, that the teachers have their salaries and the civil servants are properly paid. Not just hiring some random Cubans to fix the issues for a short time. That is not how to build a national health care system. That is how to mock the ones you already have. Peace.
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.
Today I am writing about certain comments made by the guy that took over the Election Commission after Dr. Badru Kiggundu, he is legend for his ways and his math. So Dr. Kiggundu will not be forgotten, that is why I have struggled to take this fellow serious. Because Kiggundu destroyed the EC and made it look like a foolish organization filled with cronies who has a love-affair with Yoweri Kaguta Museveni. That is true and therefore, all By-Elections since the General Elections 2016 have been in favor of National Resistance Movement (NRM), except Kyadondo East, which Bobi Wine topped with his huge star-power and speeches. So that Justice Simon Byabakama hasn’t been on my radar. This because the NRM has controlled and in-certain themselves in the by-election, where the opposition parties and independents has no control. Byabakama couldn’t do anything wrong and the NRM can just do whatever. That is how it has been for various reasons, but the NRM are really not trying to have a multi-party state, that is just a piece of flesh on the bone for donor-aid, but not for reality.
So before I rant, here is the statements on the EC Boss I will discuss today:
“According to Byabakama, bribery has become an evil partner with elections in Uganda. “But we are made to understand that bribery has become an evil partner with elections in this country, this undermines the quality of democracy,” he said” (…) “The law says an election result can be cancelled on grounds of bribery, despite the amount involved” (…) “Can you imagine an exercise that has cost the stakeholders, including security about sh1b being cancelled because of sh1,000 or a sachet of waragi or bar of soap? Do we really have to go to the school of economics to understand that this is not tenable in economic terms?” Byamukama wondered” (Nambogga, 2018)
Well, Byabakama have been under a rock or not followed what the party that appointed him and anointed him to become Electoral Commission Chairperson. That the Chairperson didn’t know how the ruling regime and the ruling party has acted during elections. It isn’t only misuse the army and the police as a political tool during elections. All of the state coffers and reserves are used.
Therefore, that the Chairperson Byabakama are now saying bribes are bad. He should start discussing this with the Entebbe State House. Who has sanctions the give-aways to Pastors, Residential District Commanders and others who was getting Prado’s and SUV’s within days of the Election. That is the big buys of loyalty and bribes.
The others are the voter tourism, a definition that came about because between 2015 and 2016, the NRM party and their organizers hired buses, paid t-shirts and food for villagers to bigger local rallies. They even gave smaller sums of cash to the people to listen to Museveni and the group of musicians that was also paid massively for their campaigning for the President. It is sort of hard to forget the massive amounts of shillings spent on the Campaigning of the President. Only for November 2015, the NRM Party spent massively 125bn shillings. That is something one report said and could calculate. The other months up-to February 2016. Can question the whole spending of the NRM. Every single rally before the February 2016 was biggest breaches of bribery of voters. It’s like the Chairman was blind to this or was himself in Finland while it was happening.
The evil partner of bribery is built in the system of corrupt behavior from the State House. They misuse all parts of government and all parts of society. If there isn’t loyalty, it can be shut-down. That is how Museveni works.
So my question to Byabakama: Will you ask His Excellency, if the Party has any plans of stopping to bribe the public every time there is an election?
If you do? Can you also get the New Vision to publish that too? So we can again see how to-faced Museveni is. Thanks. Peace.
Nambogga, Jackie – ‘EC Boss warns against bribery in politics’ (04.02.2018) link: https://www.newvision.co.ug/new_vision/news/1470404/ec-boss-warns-bribery-politics
As the Telecommunication companies like MTN are praised the by the government, the National Resistance Movement have clearly let the economy become addicted and need of the services provided by the different Telecom’s and how the operate as village banks. The further proof of this comes when looking into a study and of the value of Mobile Money. This is done by all of the Cellphone providers in different names, but has the same outcome. Either by sending money to village funds, paying for utilities or even add airtime for a friend. The report conducted and made by Economy Policy Research Center at Makerere University we’re an interesting read. Here is the quotes worth assessing over. The historical backdrop of the vast amounts of trillions shillings in the operations. Shouldn’t surprise anyone, considering that one third of Ugandan citizens use the Mobile Money and average rate of monies sent during a month are 250,000. With the amount of people and amounts traded by Mobile Money, it is a booming business and first trying of banking. But doing it directly by the phone and not at the offices of Standard Charted or Barclays. Just take a look!
“After 5 years of operation of mobile money services, the average adoption rate stands at 250,000 persons per month from inception (March 2009) to December 2015. The increase in access to formal financial services, from 28 percent in 2009 to 54 percent in 2013, was partially due to increased access to mobile money 1 See UBOS (2016), “National Population and Housing Census 2014”, Uganda Bureau of Statistics: Kampala services (EPRC 2013). Thirty-five percent of Ugandan adults have a registered mobile money account (Intermedia 2016). An additional 13 percent access services via somebody else’s account, including that of an agent. Mobile money account ownership surpasses the use of both banking and nonbanking financial institutions (Ibid)” (Makwejje & Lakuma, P: 6, 2017).
“Finally, mobile money balances are sensitive to monetary policy shocks, while the mobile money values of transactions are not. These results suggest that 1) Mobile money has helped households to substitute liquid and other lumpy assets for financial assets; 2) Mobile money has modest macroeconomic impacts; 3) Mobile money has the potential to improve the effectiveness of the conduct of monetary policy. These results provide additional evidence for policy makers to continue supporting the growth of mobile money platforms. In particular, policy makers should provide the policy and regulatory framework through which mobile money balances can become interest-bearing assets. This will further strengthen the monetary policy transmission mechanism because economic agents will be able to more directly respond to changes in the policy rate” (Makwejje & Lakuma, P: 17-18, 2017).
The authorities clearly has to assess it and look over the Telecom’s Mobile Money operations, as this is important part of transactions and business operations in Uganda. When such vast amounts of people using it and benefits from it. Where their funds turn digital and get traded instead of having dozens of shillings in their pockets as for balance for their trades. Also, gives the ability to send over needed cash up-country or even to family members. Therefore, the structure and the balances of people’s lives can be monitored and shows the interest-bearing assets. The help it has provided the society and also introduce a form of banking institutions to the public. Though this study did not look into the fortunes made by this sort of transactions compared to ordinary banking practices in Uganda. Which, would be interesting expose considering difference of cost for the consumer and Ugandan doing so. Peace.
Mawejje, Joseph & Lakuma, Paul C. – ‘MACROECONOMIC EFFECTS OF MOBILE MONEY IN UGANDA’ (June 2017) – Economic Policy Research Centre, Makerere University
I feel sorry for European Union Envoy Kristian Schmidt who are now sounding like a National Resistance Movement (NRM) apologist, instead of an independent spirit and understanding of the short-falls of the NRM Regime. He seems to been misunderstanding what happen during the General Election 2016. Surely, he wants the Forum for Democratic Change (FDC) and Dr. Kizza Besigye, to say it just water under bridge and let it go. Since the Supreme Court followed the orders of the 31 Years and counting President Yoweri Kaguta Museveni. First introduce some of the beautiful words of Ofwono Opondo, before the Kristian Schmidt’s foolish interview with Daily Monitor, before enlightening fellow European of his ignorance or forgetting the blatant impunity towards Besigye and FDC in and around the General Election 2016. Since he has forgotten while drinking Nile Brew in the Embassy and going on Safaries with his dignitaries. Surely, Schmidt must feel good about himself!
““In this election, Besigye gained 1.5 million votes compared to two million votes he got in 2011 while Museveni’s gain was a paltry 500,000. To the NRM strategists, this is the most shocking, indeed worrying trend, and having located the cause as being our messaging, strategy, campaign style, internal laxity, occasioned fraud and widespread bickering. We shall not blame anybody else except ourselves. Actually, to be frank, we were almost swept away by our collective failure to robustly respond to the Opposition demagoguery on issues of youth unemployment, despair among the urban population, poor and yet expensive public service delivery and bad public relations, especially to distribution of soft campaign cash that often got stolen along the way among other issues. This, to the Besigye camp, should give hope that with better strategic organisation, not only falsehoods, they can in the future topple NRM through the ballot instead of being bad losers” (…) ““The claims of rigging, especially at the last minute through alleged intimidation of candidates’ agents, ballot stuffing, falsification or alteration of results on tally and declaration sheets and at announcements are perturbing and incredibly unbelievable. These could pass as truth if the peddlers could at least adduce some verifiable evidence from eyewitnesses and documents in their possession that differ from those of the EC, which ought to be available from the multiple sources, including the media that observed these elections” (Opondo, 2016).
So when a NRM spokesperson and Uganda Media Centre director had to come in defense of his master. In the aftermath and with the current illegitimate government. Who has no problems in misusing the government funds and had no problem rigging the election in their favor. As the FDC had massive scores of leaders behind bars, had people with Declarations Forms from Polling Stations at Gun-Point, had their Headquarter barricaded and sealed off, Besigye was under house-arrest and the story goes on. Not an adventure, but a true theft a nation. Still Schmidt says this to the FDC and former Presidential Candidate:
“He added: “That is of course an issue that is dividing but I think it would have been good to come together and discuss. It has not happened and election reforms seem to be not going forward.” (…) “The law of Uganda is what it is: the conditions of petitions are what they are, and for a petition to be successful you have to do a lot of homework. Under your Constitution I believe you have little time, 10 days. I know one of the recommendations of the Supreme Court is to extend that time which I believe makes sense.” (…) “ He said “I think if Dr Besigye was convinced before elections that he would not be happy with the outcomes and the process, he should have been the one to petition. He should have prepared for that but he decided before that he was not going to and under the rule of law.” (Musisi, 2017).
EU Envoy to Uganda Kristian Schmidt, I know you visited him while on undetermined house-arrest. Since the Police Force had been stationed in Kasangati, Wakiso for so long days before the election and until May 2016. When he was able to escape and have his own swearing-in ceremony, before air-lifted to Moroto, where the state charged him with Treason charges. Which he still carries today, he is an arch-criminal and seen as an enemy of the state. Than after all of this, you talk about rule of law, justice and courts. Like Dr. Kizza Besigye haven’t had his time in court, haven’t been detained on more occasions than ordinary thief, even more than average murderers in the Republic.
So, the FDC was unable to counter with a petition, Amama Mbabazi was the only one able to fill in a form or petition. Because FDC has done so after General Election 2011. So it is like the EU Envoy for Uganda Schmidt is not in concern anymore of all the breaches that happen to Besigye. Like the whole House-Arrest period, the whole part of the general assault on the rule of law considering the elections and polls. The self sufficient pre-ticket ballots and Badru Kiggundu’s own special math-class. The statistics and the vicious attempt of forging the whole election in favor of President Museveni.
It like he wants the one on Treason Charges since May 2016, since the coup d’etat in February 20th 2016, when the Electoral Commission announced the result. That as the whole NRM and state organization was behind the whole ordeal. Even the European Election Observation Mission and the Commonwealth Election Observation Mission was explaining the massive flaws of the General Election. Still, the EU Envoy want Besigye just to let it go.
Let’s take his first reasoning, since it is shows his true passion, the Danish dignitary: “Now if this was in any other democracy, like in some European countries, it would be unacceptable that the Opposition party does not then recognise the winner of the elections” (Musisi, 2017). If this was an election in Europe, all of these ploys of the NRM wouldn’t have happen. Not normally, that the army is used to intimidate, that local leaders are paid-off with new cars, that ballot are pre-ticket ballots and all powers to be to silence the FDC. Together with the obvious rigging and mismatch of acts in favor of Museveni. If this would not have happen in a European elections and EU Envoy to Uganda knows this. That why it is remarkable that he says about Besigye.
Besigye knows better and the Ugandan people knows so. They are not fools, even if Schmidt is sounding like Ofwono Opondo and has taken lectures from Andrew Mwenda. He surely has hanged in the same bars in Kampala as these two. To sound so blatant ignorant and so forgetful. Peace.
Opondo, Ofwono – ‘The media shouldn’t parrot Opposition false claims’ (28.03.2016) link: http://www.monitor.co.ug/OpEd/Commentary/Media-parrot-Opposition-false-claims/-/689364/3135890/-/2m2g7v/-/index.html
Musisi, Fredric – ‘Besigye refusal to recognise government not helpful – EU envoy’ (09.07.2017) link: http://www.monitor.co.ug/News/National/Besigye-refusal-recognise-government-not-helpful-EU-envoy/688334-4006606-er8gyr/index.html