President Yoweri Museveni has said Ugandans who paid 1% percent mobile money tax should be refunded.
In a statement issued on Facebook, Museveni insists that the 1 per cent tax which he ordered to be reduced to 0.5 percent last week was passed in error and he signed the bill knowing it had an error.
The mobile money tax and social media tax which triggered massive outcry were effected at the start of 2018/19 financial year.
"I signed the law with the error because we could not delay the other measures. However, parliament, when it reconvenes, will be requested to correct it. The ones whose deductions had been made on the basis of 1% should have their money reimbursed," said Museveni.
Apart from salary earners and those who use banks, Museveni said the earnings of many other Ugandans are not known. He revealed that each day, $52 million moves around in the form of mobile money that translates into $19 billion a year.
"Mobile money tax is a different category from the social-media tax. Mobile money transfer is not a luxury. It is, in fact, a necessity and a very convenient way of sending money," he said.
Museveni said government will continue listening and reflecting on questions such as; should government only deduct tax from the sender or also from the receiver? And is mobile money tax affordable?
He said there are some corrupt government officials who have been aiding multinational telecommunication companies to evade tax.
"They have been hiding the movement of money in and out of the country, the coming in and going of telephone calls, the misuse of social media for subversion and malice," he said.
"All these dishonest people tried to misinform the public in order to incite them against the efforts by the government to achieve financial independence from their foreign masters," he revealed.
These, telecommunication companies, Museveni said have been stealing taxes that hasn't been collected by Uganda Revenue Authority.
"Some of the thieves steal our money that we have already collected. Others steal the money we have not collected in the form of concealing tax sources, under-declaring telephone calls, under-declaring rents collected from buildings, under-declaring the value of import," Museveni argued.
With Uganda's current GDP of Shs 103 trillion, Museveni argued that the country would attain budget independence and self- sufficiency if all the legitimate taxes were collected.
Social media tax
Museveni is, however, relentless and uncompromising on social media tax. He described social media as a luxury that has generated billion of revenue for foreign companies.
"Using internet to access social media for chatting, recreation, malice, subversion, inciting murder, is definitely a luxury," Museveni argued.
He added; "As I said in my earlier message, it is, moreover, a luxury that is costly to the country's economy apart from the shillings the users keep spending to use the internet to access the social media (Facebook). The foreign telephone companies accumulate a lot of local shillings from the social media merry- makers or malice promoters; they, then, go to the forex bureaus and buy the dollars."
Museveni also said Ugandans who are questioning where and what the numerous pay are and do are blind to the numerous hospital facilities, according to him the successful free Universal Primary Education (UPE) and Universal Secondary Education (USE) high enrolment, infrastructure developments such as roads, power dams etc.
Besides, he said even paying back loans that some Ugandans claim are the source of funds for Uganda's infrastructure, government pays back using collected taxes.