Uganda telecom operators to start charging social media tax

Uganda

Uganda’s major telecom operators, including the local division of South Africa’s MTN Group, said they will ask customers to pay a new government tax on social media accounts before they can access them.

Last month, Uganda’s parliament passed new laws that introduced a new tax on use of so called Over The Top (OTT) services: communications platforms offered over the traditional telecom networks.

They include popular social media platforms WhatsApp, Facebook, Twitter, Google Hangouts, Yahoo Messenger, Instagram, YouTube, Skype and others.

List of some social media applications to be taxed as of Sunday in #Uganda. Grindr is included. Homosexuality is illegal but use of Grindr must be taxed.

No word on VPNs though. Can they be blocked too? pic.twitter.com/D6TCr2tLVF

— Catherine Byaruhanga (@cathkemi) 29 juin 2018

The tax is supposed to come in with the 2018/19 (July-June) financial year and each user is supposed to pay a flat fee of 200 shillings ($0.0516) per day.

A joint statement from MTN, Bharti Airtel and Africell on Friday, said that from July 1 OTT services can be accessed on payment of the OTT tax by the customer.

Following the directive from the Government of Uganda, a new Tax is to be implemented on Over The Top (OTT) services effective 1st July 2018. #SocialMediaTax pic.twitter.com/hE0w5pVifr

— MTN Uganda (@mtnug) 29 juin 2018

Payment will be via the three telecom firms’ mobile money platforms. Customers will then be granted access to the platforms if they already have data on their devices.

Tax to be implemented despite criticism

Critics of the new tax say it will potentially hike the cost of data in a country where per capita income stands at about $600.

Data costs in Africa are already among the world’s highest, according to digital advocacy group World Wide Web Foundation.

Of Uganda’s 41 million people, 23.6 million are mobile phone subscribers and 17 million use the internet, according to state-run Uganda Communications Commission.

Opponents of the new tax also say it could also act as a curb on free speech in the country, but government officials say the levy is needed to generate revenues to fund expansion of public services.