Telecom companies in the country have implemented the revised tax measures on mobile money transactions – from 1% to 0.5% on withdrawals only.
The implementation comes after the assenting of the Excise Duty (Amendment) Act (2018) into law by President Yoweri Museveni.
This Act reduces the tax that went into force on 1st July 2018 and limits its application to only withdrawals from customers’ mobile money wallets.
“The tax will not apply to other forms of mobile money transactions like payments, sending and receiving money and deposits or buying of airtime and bundles using MTN MoMo,” a statement issued by MTN Uganda says.
MTN Uganda notes that, “This is a welcome move that is applauded by the industry because the customers spoke, and they were listened to. MTN’s hope is that the reduction in the tax will bring back mobile money customers who had been discouraged from using the service due to the high cost of the tax”.
“We believe that mobile money has greatly accelerated financial inclusion by overcoming access to money barriers. It also further promotes business, trade and commerce especially within the informal sectors of the economy and rural, hard to reach parts of Uganda which have no access to formal financial services,” the statement adds.