Government Plans To Scrap 12% Tax On Internet
The government is planning to scrap off the 12% excise duty tax on the internet which was introduced in this financial year after discovering that it’s limiting the growth of the online business.
This has been disclosed by the chairperson of the parliamentary committee of finance Dr. Keefa Kiwanuka upon receiving a petition from civil society activists from Gateway Research Center indicating negative implications of internet tax on the economy.
In July 2021, the government replaced the OTT tax with a direct 12% levy on the net price of internet data, after which a value-added tax (VAT) of 18% will apply. According to Gateway Research Center, a think tank that undertakes research on policies in areas of health, education, and agriculture has petitioned the parliamentary committee of finance today, this has crippled the socio-economic wellbeing of citizens.
It’s from this interface that the chairperson of the committee of Dr. Keefa Kiwanuka announced government plans to scrap off the 12% excise duty tax. Kiwanuka revealed that consultations are going on between the ministries of finance to waive off this tax after discovering that it is limiting the growth of the online business which would earn the government more taxes.
According to the Finance committee chairperson Dr.Keeffa Kiwanuka, the government is not planning to bring new taxes in the next financial year but to introduce new policies to enhance compliance and boost revenue collections.
Gateway Research Center has tasked the committee of finance to revise electricity tariff rates by lowering the monthly Yaka service fees by 50% and revising National Water and sewerage corporation charges by lowering the VAT by 10%.