Private Sector Foundation Uganda-PSFU has tasked Parliament to study the mobile money tax and sector comprehensively instead of focusing on the 0.5 percent tax proposal.
The Executive Director PSFU, Gideon Badagawa, made the proposal while appearing before the Finance Committee, which is scrutinising the excise duty amendment bill number 2 2018.
The bill seeks to revise the mobile money transactions levy from 1% to 0.5 percent. According to Badagawa, there is no clear reason why Government introduced the 1 percent mobile money transaction levy. He asks government to go slow on the tax, saying it is already affecting the economy.
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He says by pushing the 0.5% tax levy without research and thorough study, government might not succeed in realizing the more than Shillings 100bn it seeks to collect.
Moses Goli Ogwal, the Director Private Sector Development, says the turnover of mobile money users has decreased to 60% since the 1 percent levy was introduced.
He cites solar companies whose services have been dependent on mobile money as some of those making loses because of the tax. Ogwal proposes a 0% tax on mobile money transactions, saying people have run away and should be convinced to comeback.
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The Finance Committee chairperson, Henry Musasizi says they will interface with several stakeholders before they can forward the proposal to Parliament.