HomeNewsBusinessOTT Ends Today, to be Replaced by Excise Duty on Internet Data

OTT Ends Today, to be Replaced by Excise Duty on Internet Data

The government has abolished Over The Top (OTT) and replaced it with excise duty on internet data with effect from 1st/July/2021 which is tomorrow.

Ugandans will start accessing Internet services and all other social media sites without paying the Over the Top (OTT) tax or using encrypted connections such as Virtual Private Networks (VPNs).

The government has abolished the Shs 200 per day OTT tax and imposed a 12 per cent tax on Internet data in the new financial year, which starts tomorrow.

OTT tax was abolished by 11th Parliament in the Excise Duty (Amendment) Act, 2021, and replaced with excise duty on Internet data.

Internet data is used over a mobile connection that is not (Wi-Fi) to browse the web, check emails, play a video game, download music or use online streaming sites such as YouTube.

The government is going to charge every time one buys data for Internet use, flow of data over the entire Internet, or in certain network links of its constituent networks. Common traffic measurements are total volume, in units of multiples of the byte, or as transmission rates in bytes per certain time units.

This what State minister for Planning Amos Lugoloobi, while presenting Financial Year 2021/22 budget on June 14, said the excise duty is tailored towards enabling the country attain industrialization for inclusive growth, employment and wealth creation.

OTT or social media tax was first introduced in 2018 and caused a nationwide uproar and protests in Kampala led by then Kyadondo East MP Robert Kyagulanyi, aka Bobi Wine.

Following public uproar, the government proposed to drop the tax, saying Uganda Revenue Authority (URA) failed to hit the tax collection target from OTT. This was after Ugandans resorted to VPNs to bypass the government tax.  URA in July 2019 said they had collected only Shs 49.5 billion out of the targeted Shs 284 billion from OTT for Financial Year 2018/2019, a shortfall of 83 per cent.

Jolliebest Kasajja
Jolliebest Kasajja
Jolliebest Kasajja is a Ugandan Photo Journalist, Influencer, Photo and Videographer, News Editor and a critic in African Politics
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