By Ronaldo Nahabwe
Bank of Uganda Governor Prof.Emmanuel Tumusiime Mutebile has broken the hearts of mobile money users after making a U turn and supported the new taxes on the mobile money transactions!
A few weeks ago, the Central Bank officials advised parliament to scrap off the taxes which had caused uproar among Ugandans. Prior to their comments, their boss Emanuel Mutebile had warned the Government to drop the taxes because they were ‘seriously’ hurting the economy as transitions had dropped drastically in the first two weeks of after the implementation of the barbaric taxes.
Due to public outcry president Museveni was forced to reduce tax on all mobile money transactions from the earlier 1% to 0.5%.
BoU officials advised parliament that mobile money transactions had declined by Shs 672Bn in the first two weeks of implementing the mobile money tax. They were against the new Ministry of Finance proposal of 0.5% tax.
Now, while meeting parliamentary Finance Committee , Governor, Mutebile and the State Minister for Planning, David Bahati revealed that the Ministry of Finance and BOU had agreed to have the 0.5% tax on Mobile Money withdraws retained.
“Following the meeting we had with the Governor, the staff with the Bank who interfaced with the Committee, this is the final position of Government… we are still standing by the tax measure; the reduction of measure from 1% to 0.5%. We think it will be a good step in the right direction,” Bahati said.
In an earlier interface with the Finance Committee, Charles Abuka, Director Statistics at BoU warned that the new tax levy has the potential to increase tax evasion and avoidance including use of informal methods of sending money.