Cabinet has directed telecom companies to stop taxing people depositing cash on their personal mobile money accounts.
The State Finance Minister, David Bahati, disclosed this during the cabinet presser at Uganda Media Centre today.
On Sunday, telecom companies started effecting the one percent tax deduction on all mobile money transactions. In a public notice to mobile money users, the telecom companies said the tax would apply to deposits, withdrawal, sending and all kinds of payments.
The deductions drew angry protests from mobile money users accusing government of double taxation.
Minister David Bahati says the mobile money levy came up for discussion in cabinet on Monday. He says cabinet clarified that the tax isn’t applicable on deposits on personal mobile money accounts.
Apart from removing the tax on personal deposits, Bahati says the tax will be enforced as it was passed by parliament. He explained that government will review the new tax where necessary.
Bahati also said they have asked telecom companies to invent and innovate ways of ensuring that social media users pay the Shillings 200 levy conveniently.