David Bahati, State Minister of Finance for Planning says the target was Shs115bn but government has since collected Shs179bn in mobile money taxes.
To Bahati who was speaking at the Pre-Budget Reading Dialogue held at Kampala Serena hotel by NTV Uganda Wednesday night, this means mobile money usage is growing.
Bahati said Mobile Money tax has helped Ugandans contribute to the development of their country.
Petronela Raluca, a Senior Associate at Deloitte Uganda, says mobile money has done a lot for financial inclusion and therefore need to review the mobile money tax.
“Key question to ask is: who pays the taxes? Most affected by the tax are not income earners. They are people who are being supported.”
According to Bahati, many Ugandans are worried about the debt “but I want to say that we are in a comfortable zone”.
He said there has also been concern about where government will get money to finance the budget but he suggested some reforms in issues to do with rental income “so that we earn more from those with buildings in town”.
“We have had some challenges with road construction in our move to develop infrastructure and I want to advise those who might have to be compensated to just receive the compensation that Government that gives and move on.”
He added: “Don’t take government to court because of compensation because then, you are becoming a hindrance to the country’s development.”
Uganda Debt Network says from a public debt position of an approximate UGX 45 trillion (compared to UGX 40.5 trillion for FY 2019/20 budget and away from the suppressed BOU figures at UGX 42 trillion) as at December 2018, the 12.3% public domestic debt growth is unacceptable.
Such scale of debt grossly erodes the good budget proposals for FY 2019/20.
The modest recovery growth in Private Sector Credit in FY 2018/19 would otherwise be better.
It’s critical that the financial sector’s contribution to economic functions be nurtured for meaningful economic recovery, expansion and distribution of opportunities.
The apparent scale of domestic debt should not suppress access to cheap private sector credit.
Else good efforts so far in prudent inflation management and related paraphernalia will be in vain.
With more opening up by Government to all interested Ugandans to make input into the budget proposals, this will yield more accountability and joint efforts for economic growth prospects of 6.3% in FY 2019/20 and 6.7% over the medium term.