MPs collect signatures to oppose tax on mobile money

Members of Parliament have started a process of collecting signatures aimed at opposing the proposed tax of 1 percent on the value of the transactions on Mobile money.

The legislators under the Forum on Public Finance Management (PFPFM) were led by Deputy opposition Whip, Roland Mugume say the tax is aimed at crippling the poor and favouring the rich. They claim that they have so far collected 115 signatures and are now targeting 320 signatures to oppose the move.

Government through the Ministry of Finance has introduced the new taxes through a new tax proposal for financial year 2018/2019.

The MPs say that this tax will increase the cost of sending and receiving money which will greatly affect businesses.

“We are concerned that the tax will reduce the uptake of mobile money services and adversely affect their businesses which will have a negative knock-on effect across the economy; this will as well reduce the amount of money available to cater for basic needs like health and education,” Roland Mugume said.

He also adds that government future plans to pay the elderly and university students through mobile money will be affected by this.

“One of the programs that will be affected directly are government plans to use Mobile money for payments to the elderly, the vulnerable and even refugees among others,” he said.

The Kassambya MP Gaffa Mbwatekamwa said that the tax proposal could promote money laundering criminality.

He says Government should think of other tax alternatives. He added that the government should consider raising taxes on mobile money income balances especially the escrow accounts which could result in collection of 800 billion shillings, encourage savings and income distribution.

Manjia county MP John Baptist Nambetsye says the tax that Government is imposing cannot be handled by people, especially those who are using the services to help their families and run their small business.

“The tax is too much, you want to tax everything and you are not involving the people, and yet the services are also poor. Government should tax other avenues and expands its tax base but not focus on depleting people’s resources” Nambetsye said.