Parliament has scrapped clause 2 in the Finance Bill, 2014 which sought to mandate Uganda Communications Commission to remit to the Consolidated Fund, half of the 2% levy charged on the gross annual revenue of operators.
The other half was to be shared between Information and Communication Technology development and Rural Communication in ratio of one to one.
The MPs argued against a recommendation of the committee on finance to approve the levy and instead concluded that Parliament could not closely monitor the monies from the consolidated fund yet it is critically needed to fund the ICT sector.
The levy was at 1% last financial year but the Finance Ministry had proposed to increase it to 2% this Financial Year.
The Finance Committee had observed that Government needs revenue to finance other sectors which support an effective ICT development in the Country hence recommending that the proposed clause 2 be passed.
Section 68 of the Uganda Communications Act, gives UCC power to levy a charge on the gross annual revenue of operators licensed under the Act, a rate which the law says shall not be less than 2 percent and not exceed 2.5 percent.
Kyadondo North MP Robert Kasule Ssebunya, the Finance Committee chairperson noted that his committee examined the clause and recommended that the proposed clause 2 be passed.
He however failed to convince the House that this Financial Year government has no enough money to fund the budget and therefore a need to have the levy.
However, MPs disagreed with the Committee recommendation. Shadow Minister for Finance Geoffrey Ekkanya proposed that the clause be deleted saying that ICT is a compulsory subject in schools, a provision which still falls under the mandate of the Uganda Communications commission.
UPDF representative Elly Tumwine noted that the key issue is to use ICT to drive the economy to growth and that Parliament needs the ICT money in a place where it can closely be monitored but not in the consolidated fund.
The Minister in charge of planning Matia kasaija told MPs that deleting the clause would mean reducing on the revenue size on the budget.
He said government envisaged to utilize the allocation this financial year to improve the performance of the education sector, water access, teachers’ Salaries and other pressing needs.
Deputy Speaker Jacob Oulanyah when he put the question on whether the clause be deleted the MPs okayed the deletion despite Minister Kasaija insistence seeking that the clause be recommitted.
The House considered the Finance Bill, 2014 and passed it with the amendment approving the deletion.