The civil Society organization headed by Southern and Eastern Africa Trade Information and Negotiations Institute (SEATINI) ugand condemned Hon minister of finance ministry’s proposal to impose an excise duty of 0.5% on all bank transactions involving customers withdrawing cash from their accounts.
While addressing to the media executive director SEATINI Jane Nalongo at their bass office Ntinda says the proposed tax which they dismissed as retrogressive for inappropriately seeking to tax the rich and poor equally of which they included to guide government on progressive tax that taxes that will balance both the rich and poor.
The joint voice were raised by Kirabo Agnes of Food Rights Alliance, Nampewo Njuba of CSBAG’s and John Kakungulu Federation of SMEs. They clearly said the objective of deepening e-commerce which they said can’t be achieved through merely applying tax instruments that will push people into e-banking which is a very small component of e-commerce.
However Jane said that if it’s indeed genuine about deepening e-commerce, the GoU should address factors constraining internet penetration, availability, access and affordability.
"A country where internet penetration stands at mere 24% with only 10.6m people being active internet users, you can simply not achieve e-commerce in a significant way. Government must also address cost-related constraints because, at 1GB costing $2.67, the Ugandan internet is simply the most expensive even by the EAC standards" Jane Said.
Food Rights Alliance boss Agnes Kirabo say's imposing the 0.5% additional tax will only further constrain banks to the extent of laying off more Ugandans from jobs because the e-banking, which the GoU claims to be seeking to expand, naturally shrinks job opportunities for Ugandans.
"There will be no economy to write home about once more Ugandans become unemployed, a thing that leaves them with no disposable income and purchasing power to buy stuff from grocery shops and other businesses off which the GoU already collects plenty of money in taxes" Kirabo Said.
Meanwhile Kirabo ask GoU to leave Ugandans alone because they are financially constrained enough already due to CODI19-related consequences. She also spoke of millions of adults who have since lost all their income earning opportunities and are now total dependents on those few relatives who are still lucky to access any income-earning opportunities.
Sophie Nampewo of CSBAG said that This tax is very unhelpful because it will increase the cost of saving while keeping many would-be savers and bank customers away.
"Strengthened banking sector is critical to the GoU’s efforts to locally mobilize financing for investments which is the only way through which more jobs can be created and more taxes realized for the government to finance the provision public goods and social services" Said Sophie.