By Mwebya Fred
In this post, I am going to air my opinion on why I think government should not impose these taxes but instead should invest more in helping Ugandans access the internet. As an individual that is passionate about ICT and with strong ambitions of investing in the E-commerce sector, I am directly impacted by the proposed government tax on social media. Please note that my opinion is not in anyway politically influenced.
The fact that the President and the Minister of ICT cited different reasons for imposing this tax on social media users is good enough to show how this was not given enough research. The President wants to reduce “Lugambo” (Rumour mongering) whereas the Minister cites boosting local content. Contrary to what Minister Frank Tumwebaze cited as a move to promote local content by taxing social media users, I strongly believe that this tax will instead further curtail the efforts of promoting local content on the internet. Taxes will discourage social media usage.
I also strongly believe the President and his Minister of ICT were misguided to misunderstand the term local content on the internet to mean locally innovated applications yet local content goes beyond internet applications.
Tourism is one of those sectors likely to suffer. We also need to appreciate the fact that online communication as a strategy by the government has been embraced in the later stages of social media and government has not yet fully utilized these Applications as a channel of reaching out to its millions of citizens.
On the bit of taxing, if government taxes the gadgets that Ugandans use to access social media on top of taxing telecoms for the airtime sold to people, why would they find it necessary to slap another tax on social media Applications users. To me, this looks like double tax. If government really wants youth to get involved in practical skills so as to create opportunities of self employment, why would they want to tax platforms that are very important in the marketing of products made by the youth in Uganda?
I also believe that the letter dated March 12, 2018, that the President wrote to Minister of Finance, Matia Kasaija only focused on the end results of revenue collection without considering other consequences of this social media tax to the end users of Apps. Due to the fact that Uganda’s internet penetration is believed to be at 31.3% far behind our neighbors Kenya who are at 77%, what makes government think by introducing a social media tax, our internet penetration will increase? How does govt expect Ugandans to compete?
When the Minister of ICT cites China as one of the countries that stopped WhatsApp to protect WeChat, I would only like to remind him that China has about 772 million people with access to internet compared to the 15 million Ugandans. More so, China has invested more than we have. I also want to add that contrary to what the Minister of ICT cited as Facebook and other Apps making money from Ugandans is not true because Ugandans make more money locally from Facebook than what Facebook makes from Ugandans not forgetting the telecoms selling social bundles.
Taxing social media users in Uganda is not what will promote local content, but the government strategically investing in ICT infrastructure and supporting local ICT hubs & individuals is what is going to promote local content. I really think that the fovernment imposing a tax on the already expensive cost of the internet in Uganda will only further hamper access to the internet and widen the gap in internet penetration as compared to our neighbors with whom we compete economically (EAC).
I also think that by the Minister challenging Ugandans to come up with local content without government strategically investing in ICT hubs is somewhat an idea that is not feasible. The Minister should instead lobby government to empower local innovators with more investments.
The writer is a digital, E-commerce enthusiast and founder of Tout Media Uganda