12% Data Increment Set To Impact Businesses Negatively

The government recently passed the national budget for the financial year of 202/22 and this raised a number of eyebrows.

Among the topics of interest to the lay man was the scrapping of OTT which was mandatory when accessing social media.

This tax was adopted a few years ago despite much opposition from the public who said it was a hindrance to the flow of communication.

Others argued that it was a big hindrance to there businesses since many people nowadays run their businesses over the internet and social media channels.

The government in the new budget has however scrapped the Ott which was shs200 daily. It however instituted a 12% increase on data bundles a thing that has been contested among different people. These feel that at a time when the world is grappling with the covid 19 pamdic which has ravaged economies globally, the government should not try to mitigate the internet but rather encourage it’s use.

This is one of the moves the government intends to finance 50% of the budget domestically.

However, some people who run their businesses using data said this was a foul move which government ought to redress.

“There was a time government introduced the mobile money tax. It really hindered us because we wanted our customers to use it. We hoped to intergrate our systems with mobile money but we failed and resorted to scratch cards. With the introduction of this tax, it’s going to affect the internet and make it difficult for us to use.” Watson Atwine the chief technology officer of Agro supply limited said.

Tax experts warned that this move was bound to keep more Ugandans in poverty. With the second wave of covid 19 having hit the country, it is said 10% of Ugandans are trapped in poverty.

“This tax has really come at a wrong stage when businesses really have to adhere to the tough Sop’s. The good thing with Ott was that you only had to pay 200/- per day but for this tax, the more data bundles you buy, the more it affects you.” Juliet Najjinda a tax expert at Pwc Uganda said.

Experts added that all businesses working online just had their operations complicated with this tax. An example cited was the Safe boda app riders who nolonger work for the app due to the high data costs.

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