The head of state has responded to Ugandans in a long statement on Facebook drawing historical economic figures to make his point.

Museveni says the country's GDP: tax ratio has stagnated on 14.2% due to telephone companies under-declaring their calls, tax evasion and consumer taxes on "mainly luxuries, income tax, profit tax and import tax on consumables minus the production inputs".

Social Media Tax

Social media tax, formally known as OTT service tax, is levied on users who want to access social media platforms in Uganda. A user has to pay a daily UGX200 tax to use Facebook, Twitter, Instagram and other social platforms. Users make payments using mobile money services.

The head of state argues that some "countrymen donate those dollars back to the foreigners by chatting endlessly on the social media".

He maintains that all moral reasons are in favour of social media tax because "users have no right to squander the dollars I earn from my coffee and milk" to "foreign telephone companies through chatting or even lying".

Read Also: Protests planned in Kampala against mobile money tax

The 73-year-old president accuses the telecommunication companies of being "allergic to even a modest contribution to their country whose collective wealth they are misusing".

Mobile Money Tax

This came into effect on July 1st. There is a 1% tax levy on total mobile money transactions, transfers, withdraws and not until Wednesday, the tax was also affecting deposits.

The president believes that mobile money tax is useful since the informal sector is not taxed.

He says it's no harm "for users of the mobile money senders and receivers to also make a modest contribution to the development of their country".

"The 1% was a miscommunication. The actual figure was 0.5%, half of one per cent. That is what we should debate, on the mobile money," he says.

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