Social media taxpayers drop to 6 million

A phone user using VPN to evade paying social media tax

The number of internet subscribers who paid the social media tax reduced from 8.04 million in July 2018 to 6.84 million people, according to a quarterly report by Uganda Communications Commission (UCC).

The amount of money collected from Over The Top (OTT) tax commonly known as social media tax equally reduced from Shs 5.6 billion in July to Shs 3.9 billion at the end of September, according to the UCC report.

The tax introduced in the 2018/2019 financial year caused public outrage when it was enforced in July last year. Internet users are charged Shs 200 each day to access social media sites like Facebook, Twitter, WhatsApp and Instagram.

Many internet subscribers opted for Virtual Private Networks (VPNs) to evade paying the tax. The number of internet subscribers also reduced from 16 million to 13.5 million.

“In the last three months of the quarter under review, both the number of OTT taxpayers and the figure for the OTT revenues were in the declining trend,” the report says. No explanation has been given as to why OTT revenue decreased.

“The figures indicate that those who have used OTT at least once in the quarter. 50.4 percent of the internet subscribers were enjoying OTT services by the end of September 2018,” the report says.

Parliament’s committee on Information and Communication Technology early this month ordered the Information and Communication Technology (ICT) ministry to conduct an assessment on the impact of the social media tax.¬†Parliament is currently preparing the budget for the 2019/2020 financial year.