A new report released by a task force dispatched by Speaker of Parliament Rebecca Kadaga to study the impact of coronavirus on the economy of Uganda suggests it’s important to suspend the social media tax.
The report paints a gloomy economic picture of the immediate future, showing lower incomes since millions are no longer working and economic growth. The report has made recommendations that should be followed to keep it afloat.
These are; suspension of Over The Top (OTT), BoU to reduce lending rates, interest rates, and the amount of money that commercial banks must deposit in BoU.
The OTT tax, which was introduced in July of 2017, was meant to increase domestic revenue.
But most Ugandans have boycotted it and opted for VPNs to evade paying it.
It has also caused a reduction in the number of social media users, according to multiple reports.
Because of this, target collections have not been met.
Meanwhile, the parliamentary report which was read by MP Elijah Okupa on Thursday suggested other measures that could help cushion businesses and other sections of the economy from tanking.
They are:
– Urging Bank of Uganda to reduce lending rates.
– Reducing amount of money that commercial banks must deposit in BoU.
– Reducing interest rates.
– Government should produce a comprehensive economic stimulus package, which must be debated in the House.
– Taxes on Mobile Money should be reduced further.
– Buying water and air ambulances.
– Enhancing payments to the elderly.
According to Kadaga, “the report paints a gloomy economic picture of the immediate future; lower incomes and economic growth.”
