Government is yet to gazette the Excise Duty (Amendment) Act, 2018 to enforce the 0.5 per cent tax on mobile money withdrawals, according to the state minister of Finance in charge of Planning, David Bahati.
Bahati told plenary on Thursday that President Yoweri Museveni has already assented to the Excise Duty (Amendment) Act, 2018, saying it will come into force once gazetted.
"Just to clarify and remind members that after when a bill is passed here, the president shall within 30 days after the bill is presented to him or her assent to the bill…The bill was passed by this house and the president assented to the bill…The law will be gazetted tomorrow [today, Friday] to start the 0.5%," said Bahati.
Bahati's statement was provoked by concerns raised by the Nakaseke South MP Ssemakula Luttamaguzi, questioning why telecom companies haven't made any changes in relation to the tax despite the fact that Museveni assented to the amendment.
Luttamaguzi said that the delays in implementing the changes are affecting a number of Ugandans in the mobile money business. Speaker Rebecca Kadaga then ordered the ministry of Finance to appear and explain the arrangement on the enforcement of the Excise Duty Amendment Act.
However, the Kalungu West MP Joseph Ssewungu says gazetting an assented law isn't mandatory and questioned why the new tax never took effect after the president appended his signature.
"Gazetting of the assented law is not mandatory. Once the president assents to the law, it must become law…They are taxing money which is not in the law…Madam speaker let me tell you if you exceed Shs 1m by Shs 100,000 you pay Shs 35,000 now. Shs 1m you pay Shs 17,000…where is this money that is being taken?" said Ssewungu.
But Kadaga wondered how the implementing agencies will be informed of the new law if it isn't gazetted. The Mbale Woman MP, Connie Nakayenze wondered why gazetting the new law has taken longer than the old law.
"Last time we passed the bill the 1% it became immediate, the following day it was operational. What has happened this time because it’s the president himself who said it was too much and he brought it back and it was reduced. Why didn’t he leave it the way it was? Why was the gazetting this time too slow and the other time to fast." Nakayenze said.
Since its introduction this financial year, the mobile money tax face resistance from the population resulting into a reduction from 1% to 0.5%.