How Parliament debated, passed the Social Media, Mobile Money taxes
On May 30, Parliament debated and passed the Excise Duty (Amendment) Bill 2018, introducing new taxes including what is commonly as the Social Media tax and Mobile Money tax.
The bill came up for its second reading at a time when President Yoweri Museveni was addressing NRM MPs at the Office of the President building persuading them to accept the new tax proposals.
GYAGENDA KABUUBI looked at The Hansard (Parliament’s official record) and brings an abridged version of the day’s proceedings leading to the passing of the unpopular two new taxes.
At about 3pm, the clerk read out the next item on the order paper which was the Second reading of the Excise Duty (Amendment) Bill 2018. Before the State Minister for Planning David Bahati could table the Bill to be read for the second time, Dokolo Woman MP Cecilia Ogwal rose on a procedural matter.
In chair was the Deputy Speaker, Jacob Oulanyah.
OGWAL: I stand on a point of procedure. We have only a day to complete the process of the budget and when I look around, it appears our colleagues from the Government side are not in the House –(Interjections)– excuse me; I was once a whip so I know how to count, not by number but by head. (Laughter)
Is it procedurally right for us to proceed as if the House is properly constituted? Is it procedurally right for the National Resistance Movement Party to deprive us the quorum we need to pass critical and important decisions?
OULANYAH: Honourable members, the Member for Dokolo District says she has the advantage of having been a whip so she understands these things. I have not been a whip before so I do not understand some of these things. (Laughter)
All I know is that I have Members on both sides and today, they are not very many on both sides. I see there are Members to my right but they are few. I also see Members to my left and they are equally few. Let us proceed with what we can do. (Applause)
BAHATI: Mr Speaker, I beg to move that the Bill entitled, “The Excise Duty (Amendment) Bill, 2018” be read the second time.
OULANYAH: Is the motion seconded? It is seconded by the members for Jinja (Loy Katali), Kioga (Anthony Okello) and Kinkizi West (James Kaberuka). Would you like to speak to your motion?
BAHATI: Mr Speaker, the object of this Bill is to amend the Excise Duty Act, 2014 to raise the point of accounting on telecommunications services; to introduce interest for unpaid duty and limit the interest payable to the amount of unpaid principal tax; to enhance Excise Duty in respect of certain excisable goods; to amend Excise Duty on telecommunications services, and; to introduce a duty on cooking oil and on motorcycles at first registration. I beg to move.
OULANYAH: Thank you. Honourable members, the motion that I propose for your debate is that the Excise Duty (Amendment) Bill, 2018 be read the second time.
However, as you are aware, this Bill was referred to our committee. To start the debate, can the chairperson report on their findings on this Bill and then we can debate the principles?
KATALI (vice-chairperson, committee on finance, planning and economic development): Thank you, Mr Speaker. The Committee on Finance, Planning and Economic Development scrutinised the Excise Duty (Amendment) Bill, 2018 and we are now ready to report.
Mr Speaker, I request that I go straight to the committee’s observations and recommendations.
KATALI: Thank you, Mr Speaker. The committee observed that:
i) A person providing an excisable service becomes liable to pay Excise Duty on that service on the date of the provision of the service. This is meant to clarify when a person providing an excisable service becomes liable to pay Excise Duty, which is the date on which payment is made or the date on which the invoice is made, whichever is earlier.
This will ensure that when the performance of the service is completed or paid for or the invoice is issued, Excise Duty is due and payable irrespective of whether the service is used.
ii) An obligation is imposed on telecommunications service operators providing data for accessing Over the Top (OTT) services to account for and pay Excise Duty on access of Over the Top services.
Currently, voice and messaging traffic has migrated from conventional voice calls and messaging to voice over the internet and online messaging, through applications such as WhatsApp, Viber and Skype referred to as Over the Top service. OTT services do not attract Excise Duty, unlike voice calls that attract VAT and Excise Duty. This is unfair and inequitable for consumers who buy airtime and use it to make voice calls compared to those who buy internet data and make voice calls. This is also intended to clarify who is liable to account for Excise Duty on Over the Top services.
iii) The Bill proposes to impose Excise Duty of one per cent on the value of mobile money transactions of receiving, payments and withdraws.
Use of mobile money is an efficiency gain and should be taxed. Money has migrated from the traditional payment systems like banks to the digital platforms. It is, therefore, important that taxes be levied on such platforms.
Using mobile money is a choice as there are other methods of payment which are already attracting taxes. This proposed tax will generate more revenue and broaden the tax base.
iv) The committee observed that Excise Duty on soft drinks is the highest in the region. This encourages smuggling of soft drinks from the neighbouring countries. Government committed to reduce Excise Duty on soft drinks from 13 to 10 per cent in financial year 2018/2019. However, this commitment has not been honoured. Excise Duty on soft drinks should be reduced gradually to avoid loss of revenue.
In the financial year 2018/2019, Excise Duty on soft drinks should be reduced to 12 per cent.
Mr Speaker, the committee recommends that the Excise Duty (Amendment) Bill, 2018 be passed into law, subject to the proposed amendments. I beg to report.
OULANYAH: Thank you. Honourable members, the debate starts now and – as you understand – the principles are known. These are revenue laws and the purpose for which they are proposed are exactly that – to raise revenue. Is there any debate on the principles of the Bill?
JOHN BAPTIST NAMBESHE (NRM, Manjiya County): Thank you, Mr Speaker. I would like to thank the chairperson of the committee for the report. My take, as I weigh in, is on the proposed one per cent transaction value tax on mobile money.
The intention could be to broaden the tax base but it will exclude the majority of Ugandans from financial transactions. In the Bank of Uganda statistics for 2017, Uganda is second among the partner states of East Africa in financial inclusion and mobile money transactions have gained prominence among the low-income earners. Sixty per cent of our youth participate in mobile money transaction.
The current tax regime actually imposes 10 per cent excise duty on the telecoms, which in my view if it were increased beyond the current proposed 15 per cent to say 20 or 18 per cent, would not impact negatively on the majority of Ugandans who are in mobile money transactions.
Mr Speaker, on depositing, the charge will be one per cent transaction value tax. Sending money would also attract a one per cent levy and there would be a similar levy at the point of receiving. At all these stages, they have imposed a tax of one per cent.
You know that the majority of Ugandans – the low income earners – transfer almost less than Shs 45,000 on a daily basis. If you levy tax at every stage and if you say such money is migrating from the traditional payment system – the banks – for example, if it is a salary, you would have already paid Pay-As-You-Earn but as you deposit, they charge the one per cent and as it is sent, you pay one per cent and on receiving, you pay one per cent. You would even be taxing condolences. (Laughter)
Therefore, literally even the dead will be taxed in Uganda if we allow this proposed one per cent transaction value tax on mobile money transactions.
Mr Speaker, it would be better to tax the interest or increase tax on the interest of the float by the mobile money agents because on the Escrow Account, it is currently about Shs 800 billion. If that interest was taxed – which they have left and I do not know why the committee could not see this. This was a very severe omission. If this interest could be taxed, it would take care of whatever intentions the initiators of this tax are looking at.
Mr Speaker, you know very well that majority of the mobile money clients in Uganda, especially the low income earners, have been talking –(Member timed out.)
MONICAH AMODING (NRM, Kumi Woman): Thank you very much, Mr Speaker. I rise to oppose the proposed tax of one per cent on mobile money transactions in Uganda mainly because I believe that this tax is going to affect the poor of the poorest and reduce financial inclusion, which we are seeking as a country, for those particular categories of people.
Mr Speaker, when mobile money transactions were introduced in Uganda, one of the key beneficiaries was the farmers who are at the lowest echelons of the society. In addition, statistics have indicated that the increase of the services of mobile money across the countryside brought on board farmers to a tune of about 53 per cent in the financial sector.
Mr Speaker, I bring evidence from my district to attest to the fact that this service is very important for farmers. There is a programme called HIFA. This is a programme through which farmers save.
I know of cooperatives which are doing savings through mobile money and many other services through which the poor access money from the financial sector. This includes the poor through the Social Assistance Grant for the Elderly (SAGE) Programme. I also know many other non-governmental programmes that the poor use to access money through mobile money transactions.
The argument of saying that mobile money transactions are benefitting friends and relatives because the transactions are merely sending money to friends and relatives is not very true. (Member timed out.)
JIMMY AKENA (UPC, Lira Municipality): Thank you, Mr Speaker. I equally do not support the one per cent tax on mobile money. However, I want to use my time on the proposed Excise Duty on motorcycles. I have not seen anything in the report concerning this proposal.
Mr Speaker, this is an area from which I feel Government is trying to look for money. It is going to hurt a sector of the economy that is showing some level of growth. I am involved in supporting many young people to acquire boda bodas. These boda bodas are at least giving some people financial stability. When we try to increase the taxes, yet I do not see the justification on those taxes, I am concerned.
On another note, in Uganda, we have taxes on motorcycles, including the ones for competition. This affects the Ugandan team in its international competitions. Uganda is going to compete in August in Zambia but these taxes on motorcycles put us on a very weak footing to compete against other nations.
I would like to hear from the minister or the committee the justification as to why we are putting an Excise Duty on motorcycles. I have imported several of them and we actually pay a lot of taxes at the start. Thank you, Mr Speaker.
JOSHUA ANYWARACH (Independent, Padyere County): Mr Speaker, I am grateful. We are debating the principle of the Bill and this Bill seeks to amend Excise Duty.
Mr Speaker, from the proposal, the principle is already defective. My understanding of taxation law is that what we call Excise Duty, its opposite is Import Duty. In other words, as soon as any good crosses the border, you impose Import Duty. The internal manufacture of any good in the country attracts Excise Duty. That is the very reason we call it a duty; it is not a levy on an individual. Technically, Excise Duty is just a duty, it is not a tax.
Mr Speaker, since Excise Duty is levied on a good as soon as it becomes existent in the country, then we cannot actually levy a tax on mobile money transactions. Even over the top transactions you are talking about, where anyone can choose to make a call on WhatsApp – in fact, by the time airtime came into existence, it had already attracted Excise Duty.
Mr Speaker, for heaven’s sake, anywhere in the world – if anything can be cheaper and spur economic development, it is communication.
I think in principle, we are discussing a tax, which is misplaced. I would like to request that we discuss a duty. Therefore, the Excise Duty should be that levy on the airtime when it came into existence…
As I wind up, we should also look at the Excise Duty on motorcycles because it will collapse.
Mr Speaker, you taught me how to give motorcycles to these young people and I copied from your constituency. As soon as they make money – most of them are struggling to make ends meet and yet we also want them to pay taxes.
In addition to the above, when they go to fuel these motorcycles they pay taxes in order to spur economic development. I thought the honourable minister was coming here to say that we have reduced the registration fees on motorcycles. However, he is only adding more injuries to a healing wound. Therefore, the principle is defective. Thank you very much.
ANN MARIA NANKABIRWA (NRM, Kyankwanzi Woman Representative): Thank you, Mr Speaker. I stand to support the committee report.
The world over, people have problems with the payment of tax and yet they need development. Before we pass the budget, we must pass tax Bills as an obligation of Parliament. The expenditure needs to balance with the revenue. We need to widen our tax base as Uganda. Tax sometimes is a gain –
I support the one per cent levy on mobile money. It is a service gain and I will not be intimidated by anyone. I think we need to pronounce ourselves and speak the truth. One per cent levy is a service gain. If I have to go for a burial and I have to put fuel worth Shs 200,000 into my car, I would just send the money. Therefore, I will not move and save time.
Mr Speaker, I remember in the Ninth Parliament, we needed to pass money for strengthening our backbone infrastructure for the internet. It is all money.
Today when we look at how burdened we are with the loans we pass here every day; when you look at the Treasury operations this financial year in the budget we are about to pass, it is Shs 9.7 trillion. How will it be serviced if we are now claiming that people are poor and therefore cannot pay tax?
In our tax regime, the rich will pay more and the poor will pay more. However, let us all have an obligation for feeling it in paying taxes as we demand the service.
Finally, good things are paid for. Quick service is paid for. Ugandans and all those standing against tax are using the services given by Government to be able to communicate the decampaigning of the tax. Thank you.
COSMAS ELOTU (NRM, Dakabela County): Thank you very much, Mr Speaker. I also stand in support of the report of the committee and therefore, their recommendations.
I have heard a lot of arguments from various speakers. However, the issue is who will then pay the tax? Where shall we raise money to support our budgets? You know, every other moment in this House, we are passing loans. Unless we realise that we need to get avenues where we shall raise taxes and be self-sufficient, we shall forever stay in the same quagmire.
Way back, we had other taxes like Graduated Tax, which at the end of it brought everybody on board, including the poor people back home. If I may say, a one percent levy on mobile money will not be detrimental across the board.
If you send Shs 1,000 and you pay one per cent, I think that is a fair contribution. If you sent Shs1 million and you pay one percent, it is also a fair contribution on the basis of your income. I stand with the report of the committee and strongly recommend that that tax be stayed in our budget. Thank you very much, Mr Speaker. (Applause)
FLORENCE NAMAYANJA (DP, Bukoto East): Thank you very much, Mr Speaker. I stand to oppose the one per cent transaction tax on mobile money. Recently, we handled compensation by Rural Electrification Agency (REA) on way leaves and the people who were assessed for their crops such as cassava and beans were compensated with very little money. We were handling the audit queries because money was being deposited on staff accounts to go and pay them.
The recommendation of the Auditor-General was that people should be paid directly through mobile money. If someone is to be paid Shs 30,000 for his or her beans – this is one of the poorest people. I think this tax has not been brought in good faith but to punish the poorest.
I oppose it and I call upon Members of Parliament to think about the poor people and about the transactions we make. By the time you send for example, Shs 20,000 to somebody, by the time it reaches, it will be much less the amount you sent. Therefore, let us rethink and maybe levy somewhere else and leave the mobile money transactions.
PATRICK NSAMBA (NRM, Kassanda North): Thank you very much, Mr Speaker. I think we should, as Parliament, not be moved with the desire simply to expand the tax base, without knowing which part of the population we are touching.
The honourable minister is aware that on the mobile money transaction, 61 per cent send the very little money, below Shs 45,000. That tells you that once you come up with this tax, it is not going to the rich. It is going to affect the poor.
Let us take an example of the Social Assistance Grants for Empowerment where we are paying our people Shs 26,000 a month and you have to take Shs 2,600 plus other charges off them. We will not have helped those people.
It is very easy for a Member of Parliament to say Shs 1,000 is little money. However, for people who are earning less than a dollar a day in this country, Shs 1,000 is a lot of money. Therefore, let us simply not sit here and say this one per cent is little money when we are going to affect the majority of our population –(Interruption)
AMOS LUGOLOOBI (NRM, Ntenjeru North): Mr Speaker, the tax we are talking about is one per cent. The honourable member is misinforming this House that one per cent of Shs 26,000 is Shs 2,600. Mathematically, that is Shs 260. Therefore, out of Shs 26,000, that old person you are talking about would only be paying Shs 260 only.
Remember, the money we are giving to this old person has to be derived from somewhere. Is the honourable member in order to mislead this House mathematically?
THE DEPUTY SPEAKER: The honourable member has not declared which base he is using. (Laughter)
MR PATRICK NSAMBA: Thank you very much, Mr Speaker, for your wise ruling. I would like to conclude by saying that any country whose fiscal policy does not deal with inequality and poverty reduction is destined for failure. (Applause)
Our fiscal policy should always mind the poor. It should always ensure that it is closing the gap between the rich and the poor. I will not support any tax that comes to inflict further pain on the poor. Thank you.
SANTA ALUM (UPC, Oyam Woman): Thank you very much, Mr Speaker. The Bill proposes Excise Duty on motorcycles. I stand here to oppose, for the reason that most of these motorcycle riders are the youth. They pay a lot of money to the district local governments and even the sub county local governments. Taxing them will be like sending them away from their business.
Secondly, on the issue of one per cent on mobile money transaction; mobile money takes services closer to the people, more so the poor people. These poor people also pay taxes when they buy airtime. They also pay tax on the voice calls. When you now put taxes on mobile money, that means that you are taxing them very many times on the same product when they are using mobile phones –(Interjections)– I will give you later; first hold on.
Mr Speaker, in the villages, we do not have the banking services. Mobile money is the closest thing to banking our people in the rural areas have.
Now, when we say we are going to tax them, it will discourage them from using something closest to the bank. Then, where are we heading to? If we had banks in the rural areas, I would have no problem because they would have an alternative of joining the banking system.
Thirdly, Mr Speaker, I would like to ask the committee on the objective of taxing cooking oil. They have not put it very clearly. To me, I feel it would be better to tax soft drinks rather than cooking oil – (Member timed out.)
MS JUSTINE KHAINZA (NRM, Bududa Woman): Thank you, Mr Speaker. My discussion is on observation 4 of the committee where they proposed to reduce the Excise Duty on soft drinks from 13 to 12 percent.
The reason they gave is that we are losing Excise Duty because of smuggling at the border points.
My recommendation would be that we maintain the 13 per cent. If the problem is smuggling at the borders, why can’t we, as Government, enforce checking at the border points? Why do we allow these people to go through with smuggled products? Let us ensure URA does its work at the border points to check – It is because we may reduce it to 12 per cent but still, people will smuggle from across. So, it may not necessarily be the price.
So, in the spirit of Buy Uganda, Build Uganda, we need to ensure checking at the border points and also promote the standards of our products. Maybe our products could be more superior to those of the other countries. So, how are you going to support them if you do not strengthen the checking at the border points? Thank you.
ELIJAH OKUPA (FDC, Kasilo County): Thank you, Mr Speaker. I would like to make a proposal to the Minister of Finance, Planning and Economic Development. Instead of charging this tax on airtime and mobile money, why haven’t you thought of reintroducing licencing of vehicles? You can do it like the Ministry of Internal Affairs is handling the people who acquire firearms; if you buy a firearm, you pay Shs 5 million or Shs 10 million and every year, you must renew the licence and pay Shs 150,000. For the vehicles, however, you only pay once when you import the vehicle. I think the people who own vehicles are able to raise Shs 200,000 per year. Why have you never thought of that?
Secondly, this double standard cannot help us and that is why you see the people are even opposing. You have exempted the people who are supposed to pay taxes. You came here to exempt people who are supposed to pay Corporation Tax but now the local people who should be exempted are the ones you would like to tax.
Personally, I would have no problem with taxing everybody but the problem is discrimination. Everyone should pay taxes. I think this business of exempting companies in the name of attracting investors should be discouraged. That way, we will be able to raise a lot of revenue.
Also, can we put this money to a better use? It is because if Ugandans see that the money goes –
We have our ambulances. Mr Speaker, I do not know where the Government has gone because it is the Members of Parliament now providing ambulances throughout the country. What has happened to Government? We do not get money for ambulances –(Member timed out.)
DAVID ABALA (NRM, Ngora County): Thank you so much, Mr Speaker. In the little commerce I learned in secondary school, there are basic principles of taxation: productivity, convenience, equity, ability and economy among others. I do not know whether these proposed taxes meet these basic principles.
Remember the poverty in Uganda is on the rise and Teso particularly is at 41 per cent. Now, Mr Speaker, if you use those scenarios, the people who are buying these motorcycles are actually poor people. I am worried we are going to force them out of this business. That means insecurity will increase because most of them are going to suffer because of these taxes we are talking about here.
In my view, exempting powerful people in this country from paying taxes is a problem. Let us dwell on those other levels. Targeting the poor youth in this country is a problem according to me.
Mr Speaker, the argument here says the people go for mobile money by choice. It is not by choice; it is circumstantial. It is the circumstance that forces the poor. For example, in Ngora, I do not have a bank. There is no bank in the entire district. So, where will my poor people go and bank the money? In Omoro District, where you come from, Mr Speaker, there is no bank.
That is why we are saying, Mr Speaker, we –(Member timed out.)
SILVIA AKELLO (NRM, Otuke Woman): Thank you very much, Mr Speaker. I would like to get some clarification from the chairperson. Recently, I was in Dar es Salaam and I realised those people have introduced a system of revenue where you begin paying taxes when your business has reached a certain amount of money. However, the poor people who sell food on the road and earn Shs 10,000 to Shs 50,000 as profit are not taxed.
However, in our local markets, if you go with your small quantity of beans or millet, you get taxed. My question then is; from which country did you learn this kind of taxation where you even tax Shs 1,000 from a poor person without considering the base of his or her income? (Laughter)
Mr Speaker, as most people have alluded to, Otuke District is the poorest. At least some districts – you even saw from the report. We are the poorest district. As it is raining now, all the roads are cut off. The only service that we have is this mobile money to take a sick person to the hospital. Now, when you give a person Shs 10,000, they even tax Shs 1,000 out of it. So, are we double, triple or quadruple taxing?
How many times do you want to tax so that we know? It is because I have really failed to understand this type of taxing when you do not know how many times you are supposed to tax a person – (Member timed out.)
PENTAGON KAMUSIIME (NRM, Butemba County): Thank you very much, Mr Speaker. It is common knowledge that we need tax so that we can implement Government programmes or offer services. However, as a cattle keeper, I know which cow I should milk.
In this regard, Mr Speaker, I would like to address myself to two issues. The first one is on mobile money. The committee says they will pick some money as you send or receive mobile money. The committee report says that money has shifted from traditional banks to digital; so, we need to levy tax. In my district Kyankwanzi, there is no bank.
Now when they say money has shifted from banks to digital, let us put a tax, it means, “let us fail them.” They don’t have banks and they have gone to mobile money. Mobile money is a new thing here. As they start to exchange money here and there, they say, “Fail them.” What is this? –(Laughter)– In addition to this tax, there is more money that is taxed. If you withdraw Shs 100,000, they charge you about Shs 4,000. They are adding more taxes to cripple them completely.
Another issue on the boda bodas; in my district, apart from the Kampala-Hoima Road, there is no other clear form of vehicle transport inside there. I have been a medical practitioner since 2003; I am involved and I am a good midwife. I have seen mothers giving birth on the way and those who managed to come to health facilities were brought by boda boda. At this particular moment, a new Bajaj is about Shs 4.3 million. When you add something, it will go to Shs 5 million.
Look at the people buying – it means that apart from frustrating efforts of saving mothers who die on the way or who do not have an opportunity to reach the health centres, by increasing this tax, you are going to fail the boda bodas and definitely the whole system. Unemployment will rise and you will have spread doom to this country. We know that we need taxes but we can suggest other possible sustainable ways. (Applause)
ABRAHAM BYANDALA (NRM, Katikamu North): Thank you, Mr Speaker and honourable colleagues. Government does not have a money minting machine but generates money through taxes. At the end of the day, every service needs money. If we don’t pay taxes, we are reducing on the services to provide.
Therefore, I appeal to my colleagues that if we want to improve the services offered to our people, we must pay taxes. We must also broaden the number of people that pay taxes. Let us ensure that everybody gets involved in paying taxes.
Members have talked about boda boda cyclists; I want somebody to get out of this House and board a boda boda or a taxi from Clock Tower to Ggaba; the boda boda will charge higher than a taxi. Therefore, colleagues, this question that we are going to get them out of business is not true –(Interruption)
LUGOLOOBI: Mr Speaker, thank you for giving way. Previously, people have been paying this tax indirectly. Let us take the example of Otuke where there was no bank; what used to happen in order to transfer money from Otuke was that someone had to travel all the way and the implication of this was that this person boards a taxi, which consumes fuel.
What we are experiencing today, because of these new innovations in mobile money transfer, is that the number of people moving on the road consuming fuel has drastically reduced and that is affecting our tax base very seriously. Therefore, business is shifting from analogue to the digital platforms. As it shifts, the tax man should also equally shift. If we lag behind, this economy is going to collapse.
As we talk, the amount of money needed to service our loans is growing astronomically. Hon. Nankabirwa was talking about the money that we need to service our debts –
OULANYAH: You rose on information.
LUGOLOOBI: Yes, I am still giving information.
BYANDALA: Thank you, Mr Speaker. Therefore, I appeal to my colleagues that all these countries that give us grants and loans are countries whose citizens pay taxes –(Interruption)
JAMES KAKOOZA (Independent, Kabula County): Thank you, Hon. Byandala. The reality is that even in the developed world, you may be charged for spending an hour. In Ontario Canada, every hour is taxed –(Interjections)– In Uganda, they have started the Express Highway where people will have a choice to either use the old road or pay for using the Express Highway.
This tax is optional; if you want you pay, if you don’t want you don’t pay. (Applause) That is what is under the law. That is the information I wanted to give.
ATKINS KATUSABE (FDC, Bukonjo West): I want to thank you, Mr Speaker, for the opportunity. I stand here to totally oppose the report because it violates and contradicts all the principles, practice and the structure of taxation.
The projected collection already is Shs 155 billion. Chairperson Committee on Budget, you are fully aware that this country loses up to Shs 600 billion in procurement fraud and corruption alone. (Applause) What does that mean? Shs 155 billion can be got from the Shs 600 billion that we lose to procurement fraud and we will still have a balance of Shs 455 billion.
Therefore, we are losing more to corruption but we want those that are trying to survive – Mr Speaker, I don’t want to be part of a House that works so hard to strangle those Ugandans out there that are trying to survive. Thank you very much.
ODONGA-OTTO (FDC, Aruu County): Mr Speaker, I rise on a point of order. My honourable colleague from Kasese just said that this House is attempting to strangle the poor. I am a member of the Committee on Finance and we were advised – (Interjections) -Mr Speaker, protect me from hon. Anywarach. If you transfer Shs 1,000,000, you pay Shs 20,000 to the South Africans.
Today, the Government is just asking for Shs 1,000 and everyone is up in arms; this is lack of patriotism. Is the honourable member in order to mislead the House that this tax which is being introduced to let the Uganda Government also get some money as opposed to giving it all to the South Africans – that we are strangling the peasants and yet we need it to also pay our emoluments?
OULANYAH: Honourable members, the honourable member for Aruu has been dying to give information but nobody has been giving him the opportunity to do so. (Laughter)
KATUSABE: Thank you, for the opportunity. If we have a fundamental crisis in our country, it is called corruption. The moment Government takes on corruption squarely; we will have all the money that we need.
I would like to give specific proposals, Mr Chairman, can you explore the possibility of increasing excise tax from 10 to 18 per cent? –(Member timed out)
OULANYAH: Honourable members, we need to draw this to a close.
GERSHOM SIZOMU (FDC, Bungokho North): Thank you, Mr Speaker. I rise to oppose the one per cent tax because it targets the poor. I do not need mobile money because I have my ATM card; I am rich and can easily access money compared to the poor people in my constituency.
If you levy a one per cent tax, it will limit the flow of money from the rich to the poor thereby increasing income inequality. This tax is going to make the poor Ugandans poorer.
The Shs 200 is going to compound to billions of money; so, a tax that targets poor people should not be entertained. I suggest that it should be abandoned. I thank you.
OULANYAH: Honourable members, I would like to ask the Leader of the Opposition – so that we can close. It has been a long debate.
THE LEADER OF THE OPPOSITION (Winfred Kiiza, Kasese Woman – FDC): Thank you, Mr Speaker, for giving me this opportunity. I know very well that the country needs money and it is our desire as the people’s leaders to ensure that we give the population the best.
We need services, we need healthcare, we need improvement of agriculture, we need infrastructure but how do we get the money to lead us to where we would like to go? We need taxes but from whom? Time and again, the issue of tax exemption for those who are supposed to pay the real tax that would redeem us from poverty has been coming up here.
Mr Speaker, just the other day, the Minister of Finance, Planning and Economic Development was asking this House to exempt big corporations from paying corporate tax, which is money on profit.