Social Media Tax: Tumwebaze flawed argument for it!

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.

Reference:

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/

ICTAU: Public Statement on OTT & Mobile Money Taxes (04.07.2018)

Uganda: National Youth Congress – Press Release No. 1. of 2018 (03.07.2018)

The Point of No Return: Mutabazi says it’s a “Good Tax”!

“We have been complaining that we are loosing money. This decision by government is the right decision.” Godrfey Mutabazi, Chairman of Ugandan Communications Commission (UCC).

There are certain individuals, who begs no favours and don’t stop pursuing the roads of torn flesh. Certainly, these men are so well endowed and has fat pockets, that these measures doesn’t sting, but the lowest class, the unemployed and the gig-economy is not upholding the levels of taxation that is put on the public. Not that the Members of Parliament cares about the poor, unless they need donor aid or have a project to finance. Than, they are needed pawns, but right now they can eat the spoils of the poor and their willingness to communicate.

The modern communication are now attacked by these men, through the willingness of taxation. They are beating people for being online and using mobile money. They are really making sure they have to adjust and secure funds other way. The poorest will spend massive parts of salaries, if they are on social media or even if they using mobile money, not only the fees the Telecoms already take, but also the new transactions taxes, which, is taking in cash when sending, receiving and even putting in. The state is getting added funds on all steps of the way. It isn’t a one time only measure, no, they are getting tax for the trade of air-time and data-bundles, they are getting tax for going on social media and also on the transfer of cash.

How can this be good? Does the government and UCC want to disenfranchise even a bigger part of the community? Even in districts and Sub-Counties with no banks or close affiliates, where the relatives in Kampala can remit/transfer cash too, without paying for the nut, the bolt and the tool itself. That is what they will be doing now. If they are calling through WhatsApp and Viber, they will be taxed extra, not only for the airtime and data-bundle, but the direct usage. How is that any good?

Mutabazi is a ignorant rich hussy, who doesn’t understand the plight of the common man, the men and woman who are barely making ends meet. He want to insult to injury and make sure their money is less worth, as they are now taxed for transferring it and also for their communications itself. This is how to exclude people through monetary means. These things aren’t just used by the elites, these are things used by all and are common placed.

Maybe the state should tax rain-water, jerry-can water-rigging and create a clean-air act, so the people have to taxed extra for the air-filters in the luxurious homes of Bugolobi or Mbuya. As the wealth there can handle this mess, but the hawkers, the idly are the ones hit by this. They are shut out of the communication and are the ones who is left with less.

So, it is hard to say anything else. That the state really doesn’t give a crap about them. They are just sponging of them. The UCC is really demeaning the lowest classes, they are even planning to tax the VPN. There isn’t anything they are doing to silence people.

This is the point of no return. They have no scruples. They have no heart, only eating of the poor and at any cost. Using all excuses, while they are now stopped or even soon shielded from Social Media, through a payment-wall, the rich can do everything and be as ignorant of plight of men as ever before. Certainly, the UCC doesn’t give fig. that is proven now. Peace.

Social Media Tax: The Breakdown of the Key Statements from the Hansard of 30th May 2018!

Joshua Anywarach:

Mr Speaker, for heaven’s sake, anywhere in the world – if anything can be cheaper and spur economic development, it is communication (Hansard, 30.05.2018).

This is weird, but not surprising, it is striking that these quotes has not been in the spotlight more. As the Exercise Duty, which was passed on the 30th May 2018. This after just two barely months of digging into the costs, added revenue and even making it possible. This was a hasted taxes of the public. Where the added costs was not put in perspective. There was talk about the poor and the regions without banks, but not like the National Resistance Movement (NRM) cares, because you don’t have to use Mobile Money, you can send the money by donkeys for free. However, the Western Union isn’t having the donkey express anymore, even the NRM will go back-to-future with these taxes. Making sure the Social Media is silenced and costing even more for people to be involved online.

Silas Aogon, who was against said this:

Mr Chairperson, without the bundles that we buy, we cannot access WhatsApp. I know that very well. You have got to have mobile money and then you can use it to buy Megabytes (MBs) before you can access WhatsApp. How do you tax what has already been taxed? That is the issue. If you doubt what we are saying, let us then do some practicals here and then you will see” (Hansard, 30.05.2018).

That is just barely the ones speaking against Social Media Tax before the passing of the bill. However, there was more NRM MPs, who was defending it. These should be remembered, because they are silencing the poorest, because of revenue and because of their reckless spending on themselves. They added perks and salaries, are paid by the hardships of people, who will be doubled taxed, not only on airtime and data-bundles, but now for using social media too. This because the state doesn’t care.

James Kakooza said:

This tax is optional; if you want you pay, if you don’t want you don’t pay. (Applause) That is what is under the law. That is the information I wanted to give” (Hansard, 30.05.2018).

It maybe partly optional, but people are used to WhatsApp, Facebook and other Apps for communications. Therefore, it isn’t that optional, except for the ones who are advanced age, like the President himself. Maybe Kakooza should delete his social media profiles and try to be optional outside of the online world.

David Bhati said:

If you are using WhatsApp or Viber, the Shs 200 which we are proposing here will actually translate to Shs 70,000 per year. That is what we are talking about. It is Shs 70,000 the entire year –(Interjections)– You are making a contribution of Shs 70,000 for the whole year; can you imagine! It is as simple as that” (Hansard, 30.05.2018).

It isn’t like your jumping in once and never again. Its very few who just are one day inside a social network or part of group talking on WhatsApp or Viber. They are there daily, because if your wanting to get information or be in communications with friends. You do it daily. Therefore, if your part of social interactions online, this is really just making sure the youths, ordinary people are taxed for interacting online. Soon, Bhati will send birds with messages and I am not talking Twitter. I am awaiting that. Since he can choose that without paying tax himself.

Robert Kasule Sebunya said:

We have a dilemma as technology is changing every day. People are no longer using the normal calls that Government has been taxing. Excise duty of 12 per cent has been paid per normal call. Now because technology is turning into voice messaging, WhatsApp calls and others, we are losing revenue. Even institutions are losing money on normal calls because people are changing as technology changes” (Hansard, 30.05.2018).

That the public has decided to call through the data-bundles are still taxed VAT and Income Tax, the Telecommunication Companies are taxed and so is the income of the agents selling the airtime and the data-bundles. Therefore, if anyone would call on WhatsApp or Viber, they are already paying tax. Now they just have a second wall of payment and securing the state, both for the nut and bolt, but also using the tool itself. So, he defends double taxation. Kudos!

Otto Odonga said:

I did economics at the university, mind you. (Laughter) WhatsApp, Viber, Facebook are ostentatious commodities. They are almost like perfume. The ordinary man in the village can do without it. (Applause) We are looking for a certain category of people who do not mind about the Shs 200. Personally, I do not mind because I need WhatsApp. It is a tax, which is targeting the elites – those who are ostentatious. It does not affect the ordinary man in Pader. That is the information I wanted to give” (Hansard, 30.05.2018).

You have so ancient relics, someone who is falling behind in times. I hope Mr. Otto is not on any Social Media, because his defense is a disgrace in 2018. That it is an extra service. It is true it is not like water and food, or even basic education. However, this is the way people communicate and have moved forwards too. That is why activists have groups on WhatsApp and Facebook, it is like the MP thinks it is only for Kololo and other high-rising neighborhoods in and around Kampala.

This is the look over the Hansard from 30th May 2018. That shows how some of the MPs thinks, this was only about the Social Media Tax, not the Mobile Money Tax or the Cooking Oil. Hope someone else dig into that. That would also deserve criticisms. Because the NRM is really using all tactics to defend the need for revenue, without seeing how they are misusing funds and also the grand-corruption that these funds are going too. Peace.

Opinion: The 200 Shillings of Doom!

There are many things to question in this day and age, especially on the day that Mobile Money Tax and Social Media Tax comes into affect. This is affecting a nation, a Republic and the people will feel this on their body. The costs of usage on the phones will sky-rocket, if not the usage of VPN will grow into huge proportions, like it did in the Social Media Blockage of 2016. When the state had to refund the Cellphone Companies and Mobile Money Networks for the closure during the final days of the General Elections in 2016. Those where the days for the National Resistance Movement (NRM). That is why they are trying to reinforce those and see if the people remember that.

The NRM have really brought the hen before the eggs. They have ushered in taxes, which haven’t been studied, neither proven any numbers of the supposed revenue. Never told or explained the public how these would be used or where the revenue is going. If these are going straight into a Presidential Handshake or another Presidential Jet. Who knows, but certainly not going to fix the schools of Iganga or Amuriat, no one would believe that at this point.

We know that the Godfrey Mutabazi the chairman of Uganda Communication Commission is working on the closure of the VPN services. That is to be expected, anyone to stop paying the taxes will be stopped, as the triggering of changes of IP Addresses will be illegal. No one shall be able to cross passed the taxed wall made by the NRM. This revenue is to important for the Republic. They need these funds to fund the SUVs, the raised salaries of the MPs and the other perks given to them. As well as the bloated budgets and travels of the President. He can spend money and borrow foreign cash like there is no tomorrow. While the poor is taxed more and more, to levels that stupid. Where every single piece of cash is going into tax and barely minimum will go back into the market. Meaning, the lack of power to buy anything will hit the market even more. They cannot afford to do anything, if they still want to be parts of society and in the digital age.

This is really a disgrace, but what sort of place Museveni is creating with his taxation of the OTT and the Telecommunication businesses. He is attacking the Social Media and the public discourse, by taxing it away from people, because many cannot afford or goes broke doing so. It is amazing how little of this has been put into discourse, haven’t even seen it in the editors comments on the online papers. None, or very little.

The President has with this and with his letter in March to the Finance Minister done a heist. A public heist, he is now altering the poorest people away from the Mobile Money, also making them find ways to not pay Social Media Taxes, plus the other fees that are with the usage, since the companies are already earning fortunes on the spending of the public. Not like MTN, Airtel or anyone else is loosing money on the public use of cellphones. They were already getting fees for the transactions and also the fees on the data-bundles and airtime. Therefore, the industry was taxed on the usage, but now the double tax is in effect. Because Museveni doesn’t care about his people.

That is why this is happening, 200 shillings of doom. The drones and clones, the phones are so taxed to maxed, that it is to fax and doing jumping jacks. Not buy e-books, but paperbacks. Peace.

Social Media Tax: Taxes directly on Cellphone services is now a reality!

The Social Media Tax and the Over The Top Taxes, this meaning all the services on the Social Media cost 200,- shillings per day, which means 6000 shillings a month and also 1 % on each transaction by the Mobile Money Transfer. This have been messaged by the government and by the Telecommunication Companies. We even know that by yesterday, the MTN sent messages to their costumers stopping the possibility of their lowest data-bundle. Which cost 250, shillings. Because the least cost now with added tax must be 400,- shillings or so. Since they have to add in the new tax and the usage itself.

That means that the data-bundle will be more expensive now and people have to buy bigger. Because the state will sooner or later see the ones using VPN or other methods of tricking the IP addresses and whatnot. Since, not everyone can afford this. They are shielding the poor people from paying the new taxes and using the services. Over time the voices on social media will go down, even the lack of transactions through the Mobile Money Networks. That is ironic, as the state has tried to push this up-country and even in Northern Uganda. Where there are lack of ATMs and even Bank Offices. Therefore, the attack and add of taxes on these services will just be new add of hardships for plenty.

Clearly, there are many who has complied, who has paid the direct 200 shillings for the social media tax, if you paid that with mobile money, you would pay another 1 % of the transaction fee of 2 shillings on the Mobile Money. That means the total tax is 202 shillings. That before you start using the cellphone or any of the other services on the phones.

This is really insulting to the poor and the low-level employees, whose salary is down to 21,000 shillings or close to 31,000 shillings a months. That means that with the 6000 shillings each month, they would spend ruffly close to 9,7000 on the lowest data-bundle and Air-Time package. This is through Twaweza published on the 7th June 2018. Meaning the lowest salary is close to half and one third of the second lowest level of public salaries. This being U8 Local Government Employee and U7 Primary School Teachers, whose being hit hard. That not being random hawkers or unemployed who are living from hand-to-mouth. They cannot even see the Social Media already as it is, and will be shut out of the public conversation online. This is really making sure the elite are online, while the rest barely get to be a part of the discussion online.

This is really assaulting free-speech and the ability for the poor to be part of the conversation and be part of social media interactions, as well as usage of the Mobile Money transactions. Since all of this is adding costs and making sure the data-bundles and Air-Time will be more costly.

That the Members of Parliament voted and accepted this after the President wrote a letter to the Finance Minister on “social gossip” online and wanted to tax the OTT Service in 12th March 2018 and on 30th May 2018 voted in Parliament. That is how the Excise Duty was levied on the public. While it is starting today on the 1st July 2018. That means, the proposed taxes of April 2018 and put into affect now. Therefore, the public should have known about it. There are other new taxes, which is not on the cellphone, but that deserves to be taken separately.

What is weird about it all, the Twaweza study of the numbers was more vital for the ordinary person, than the Parliament report, which was focused on added revenue, not expressing how it would hit the public. Which for me is weird, as the MPs are supposed to work for the public and serve them. Not just add taxes. Peace.

Uganda – Public Notice: OTT Tax (29.06.2018)

Uganda: Public Notice of Proposed Taxes on Telecommunication Services (27.06.2018)

Another look into the Mobile Money Tax!

Yet again, more things are revealing the dire consequences of the new Exercise Duty tax that the Parliament voted through. This time it shows the significant amount of money that is already exchanged through the Mobile Money, as this is the sole way of transferring it without having bank-accounts or being involved with banking sector in general. This is made for the ones who doesn’t have a local bank and needs to transfer money to relatives, friends or even to pay-off bills through the phone. Therefore, these services are vital.

This is numbers taken from the Bank of Uganda, in their fresh Annual Supervision Report. Where the rates and usage nation-wide is presented. It shows significance. Also, the massive amount of taxation it really is.

“Mobile money services

As at end-December 2017, there were seven mobile money service providers and these included; MTN, Airtel, Uganda Telecom, Africell, M-Cash, EzeeMoney and Micropay. The number of registered customers across the networks increased by 8.4 percent, from 21.6 million as at December 2016 to 23.4 million as at December 2017. Mobile money activity continued its growth, during 2017. Transaction values increased by 44.0 percent to USh.63.1 trillion in 2017, up from USh.43.8 trillion recorded in 2016. The number of transactions rose by 23.8 percent over the same period” (Annual Supervision Report December 2017 | Bank Of Uganda).

Because if the whole you of 2017, the total mass of funds transferring through Mobile Money are on the levels of 63 trillion shillings, that means that if this was taxed with the new Exercise Duties, it would be about 630 billion shillings in direct taxes on the money. That is because the new tax is 1% on every transaction. That means that the total value being delivered from one to another is slimmer, as the one percentage of the transmitted funds will be collected as direct tax. That means if someone is sending a 1000 shillings somewhere, that means 10 shillings are directly taxed and leaves behind 990 shillings to the ones receiving it. There are also other taxes, but on this alone, there is certain amounts to be eaten by the state.

If this amount of tax doesn’t stop the growth nothing will. This is sort of amount will stop the amounts, maybe even people will send less times than before. Because they have to consider the added taxes on every single transaction. They want to make sure their money goes where it is supposed to and not give a too big of a slice to the government for the usage of the mobile money services.

Clearly, the state has hit a growing industry, but instead of making it increase, these sort of measures make it decrease and the cost will be carried by the consumers and not by the banks. They are still amassing in profits and taking their costs for the services as it is. Not like the consumer is transferring the money for free. They are not in it for charity, but for profits.

So just think about the massive cost it will be with the transactions and the lack of consideration the state had when they voted it through parliament with lack of due diligence. It wasn’t only the expensive social media tax, but it is this on top of it. To earn revenue on the hard earn cash that people are transferring through their phones. Peace.