Ugandans seek to dodge social media tax

Sunday July 1 2018

Tax on social media use in Uganda faces

Tax on social media use in Uganda faces resistance. FILE | NATION MEDIA GROUP 

By DAILY MONITOR
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Ugandan are devising ways of evading the infamous social media tax that came into effect at midnight, July 1, 2018.

According to a random survey on social media done by the Daily Monitor, several people had resorted to Virtual Private Network (VPN) to bypass paying the daily excise duty charge on Over-The-Top (OTT) services.

The Daily Monitor on Saturday conducted an opinion poll on its Twitter handle engaging its audience on how prepared they were to pay the social media tax.

According to the poll results, 19 per cent of the 581 followers who participated said they would spend less time on social media, 11 per cent said they would stop using social media while 70 per cent said they would resort to using VPN.

Educational purposes

The new tax compels every Uganda visiting any social media platform to pay $0.05 (Shs200) daily, $0.36 (Shs1,400) weekly or $1,56 (Shs6,000) monthly as excise duty.

The government of Uganda announced in the budget for the financial year 2018/2019, that it would charge those using over the top services or sites that offer voice and messaging over the internet $0.05.

In his letter directing the Uganda Revenue Authority and Ministry of Finance to tax social media, President Yoweri Museveni argued that most Ugandans using social media were rumour mongers.

Transaction value

He, however, promised to exempt those using it for educational purposes. But critics question how he would determine those using it for educational purposes.

The government also mandated the telecom companies to charge 1 per cent tax of the transaction value of the services on the mobile money.