Uganda Social Media and Mobile Money Taxes Survey Report

Transcription

1 Uganda Social Media and Mobile Money Taxes Survey Report Conducted by Whitehead Communications Ltd.

2 Table of Contents Introduction... 4 Executive Summary... 5 Methodology and Sample Bias... 8 Sample Size... 8 Methodology... 8 Social Media Sample... 9 Face-To-Face Interviews Data Cleaning Results by Question Age Gender Respondent location Breakdown by region Breakdown by district Education Occupation Sample social media users Current social media users Use of social media OTT platforms Method of social media access after tax implementation Tax payment (dependency) What people use social media for in Uganda Ugandan e-commerce Impact of OTT tax on Ugandan e-commerce Inconvenience of OTT tax Inconvenience of Mobile Money tax % Sample using Mobile Money Change in Mobile Money use after tax implementation Mobile Money use breakdown by gender... 33

3 Change in Mobile Money use by Mobile Money agents % Sample that are Mobile Money agents Mobile Money agents breakdown by gender Impact of Mobile Money tax on Ugandan businesses Public support / opposition of the social media tax Public support / opposition of the Mobile Money tax Ugandan public opinion on taxes in general Acknowledgements ANNEX A: Ugandan e-commerce ANNEX B: Impact of OTT tax on Ugandan e-commerce ANNEX C: Impact of Mobile Money tax on Ugandan businesses ANNEX D: Ugandan public opinion on taxes

4 Introduction On Friday the 1 st of June, 2018, the Parliament of Uganda passed a 32.4 trillion shilling 2018/2019 budget 1. It included a new 200 shilling (~0.05 USD) tax per user per day of access on over the top services 2 (OTTs) previously known by the general public as social media. The same budget introduced an additional tax on mobile money transactions of receiving, payments and withdrawals valued at 1% of the value of these transactions 3. These taxes came into effect at 12am on the 1 st of July, Many Ugandans found themselves instantly blocked from accessing WhatsApp, Facebook, Twitter, LinkedIn and other OTT services, and others were shocked to realize that increasingly popular 4 mobile money payments had increased in price. These developments were followed by countless public statements in opposition and in favour of the new taxes, including one opposing the taxes by the ICT Association of Uganda (ICTAU) released on July 4 th, and two missives released by President Museveni on July 4 th and 12 th. A group of activists filed a petition in the Constitutional Court seeking nullification of the OTT tax the following Monday 5. A campaign using the hashtag #ThisTaxMustGo held a demonstration against the taxes on July 11 th. This series of events dominated the headlines and talk shows in Uganda and attracted the attention of international media, as well as industry stakeholders and policy makers around the world. On July 11 th, Ugandan Prime Minister Ruhakana Rugunda announced that the Government of Uganda would review these taxes. On July 13 th at 7pm, Whitehead Communications released a survey to gather public opinion on the impact of the taxes in order to contribute a resource for evidence-based research in their review. The survey was closed at 5pm on July 16 th, collecting 2,918 responses (after data clean) and generating the following data for free use by the public at large. You are welcome to build on these findings, which we have released quickly. 1 Parliament of Uganda. Parliament passes shs32.4 trillion National Budget. Web. 16 July, The Excise Duty (Amendment) Act, 2018, defines over the top services as the transmission or receipt of voice or messages over the internet protocol network and includes access to virtual private networks; and the levy is listed in 13(b) as Ushs 200 per user per day of access in The Excise Duty (Amendment) Act, The Excise Duty (Amendment) Act, (f). 4 Ssetimba, I. J. Mobile Money in Uganda. Bank of Uganda. March, Web. 16 July, CyberLine together with Daniel Bill Ohio, Silver Kayondo and Raymond Mujuni.

5 Executive Summary The Uganda Social Media and Mobile Money Taxes Survey a public opinion survey on the impact of new taxes on social media and Mobile Money was conducted by Whitehead Communications in Uganda between the 13 th to 16 th of July, 2018, with the purpose of serving as a resource in a consultative and evidence-based review of social media and mobile money taxes. Results were collected both online and through face-to-face interviews across the country, gathering 3,015 responses (more on the methodology and sample in the full report). This report has been expedited to be released within 36 hours of closing the survey in order to provide timely information to policy makers, concerned parties and the general public. This public opinion survey produced a sizeable sample with an observable demographic profile. 72% were resided in Central Uganda, 15% in Western Uganda, 8% in Northern Uganda and 5% in Eastern Uganda, with 93 districts represented overall. Most surveyed respondents were between the ages of 18 and 35 (29% 18 24, 41% 25 30,15% 31 35). 74% of respondents were male and 26% were female. Most respondents were highly educated: 56% had obtained a Bachelor s Degree, 14% a Master s or PhD, 9% had Vocational Certificate, 15% completed Secondary School, 3% other, 2% had no education and 1% completed only Primary School. A wide diversity of occupations were represented, including: agriculture, arts and entertainment, business and trade, education, entrepreneurship, Fintech, health, ICT, law, manufacturing, marketing and communications, Mobile Money, NGOs, public service, students, travel and tourism, transportation and many others. The survey included many questions about the use of social media (OTTs) in Uganda. 96% of respondents had used social media in the past 6 months. This number dropped to 85% when asked if they had accessed social media since July 1 st. Of those who reported as using social media since the new tax was introduced: 40% said they paid the OTT tax; 57% were using VPN; 38% were using WiFi/Hotspot(s) and 3% selected other ; many used multiple methods. Of those paying the tax, 86% paid for themselves, while 3% were paid by an employer, 3% by family, 3% by a spouse, 3% other and 2% paid for by a friend. Respondents reported using the following social media platforms (selecting all that apply): 98% use WhatsApp, 92% use Facebook, 69% use Twitter, 62% use Instagram, 36% use LinkedIn, 30% use Skype, 24% use Snapchat, 21% use Google Hangouts, 12% use Telegram, 4% use Tinder, 6% other and 3% use 360 Chat. The survey also gathered insights on the state of e-commerce in Uganda. When asked what kind of business respondents conduct online, they replied with a wide

6 variety of industry sectors, including: agriculture, art, automotive sales, bakery, beauty products, clothing and shoe sales, consultancy, counseling, data entry, electronics, event promotion, fashion, forex, graphic design, law, marketing, medical, music promotion, photography, shopping, social media influencing, telecommunications and phone sales, travel and tourism promotion, web applications development, among many others. 8% of our sample was made up of Mobile Money agents, amounting to 197 respondents. Respondents also indicated how they use social media productively, including: communicating with colleagues and clients, customer service, employment searches, online meetings and planning, research and development, publishing, sending and receiving documents, tendering proposals, international trade and other activities. The survey also provided insights into Mobile Money use in Uganda. 93% of respondents reported that they had used Mobile Money in the last 6 months. When asked how their Mobile Money use had changed since the implementation of the new tax, 4% reported that they were transacting more money in July, 2% were transacting about the same as before, 44% were transacting less money in July and 47% reported that they had completely stopped transacting Mobile Money after the implementation of the new tax. Of the respondents who were mobile money agents, 36% reported that they had stopped transacting money in July, suggesting a significant impact on closure of these businesses. Respondents were asked about the impact of the new Mobile Money tax on their businesses. 2,334 respondents offered their answers, which fell into the following thematic groups: delayed payments, general inconvenience, increased cost of doing business, increased risk, loss of income, reverting to banking and cash payments. Those conducting business using social media were asked about the impact that the OTT tax had on their livelihoods, and 1,640 people offered responses on how they had been affected, revealing the following trends: delays in conducting business, disrupted payments, general inconvenience, increase in the cost of doing business, loss of income, reduced access and a smaller online audience. When asked, is the OTT tax on social media inconveniencing you, 71% responded that they were extremely inconvenienced, 17% very much, 4% moderately, 2% slightly and 6% not at all. When asked whether they were inconvenienced by the Mobile Money tax, 83% of respondents said that they were extremely inconvenienced, 13% very much, 2% moderately, 1% slightly and 2% not at all.

7 When asked, do you support the social media OTT tax : 1% of respondents strongly supported the tax, 3% somewhat supported, 2% were undecided or neutral, 21% did not support and 73% strongly opposed. When asked, do you support the Mobile Money tax : nearly 0% strongly supported the tax, 1% somewhat supported, 1% were undecided or neutral, 19% did not support and 79% strongly opposed. When asked for their opinion on taxes in Uganda, 2459 respondents offered their views. Several themes were observed, including: accountability, double taxation, financial inclusion, misuse of tax funds, over taxing, poor planning and the taxation method of implementation. We invite the relevant decision makers to review the detailed results of this survey in full, particularly respondents written replies to the questions: how they are using social media for wealth creation; how their businesses have been affected by the new taxes on social media and mobile money; and the public s opinions on taxation in general. Furthermore, we encourage thorough consultation among all parties going forward to ensure an informed and equitable solution.

8 Methodology and Sample Bias This public opinion survey on the recent social media and mobile money taxes in Uganda was carried out using a mixed methodology in an effort to reach a diverse and representative sample of respondents in Uganda. Although this survey reached a large number of Ugandans and its results seem to confirm what is being heard on social media and in mainstream media, boda stages and bufunda across the nation, it is important to remember that surveys have limitations in how well they represent a population, and this is no exception. Sample Size In total, 3,015 people responded to this survey, though after cleaning the data we were left with 2,918 responses out of a Ugandan population as reported by UNFPA to be 42.9 million in Note that our sample also represents a country with 24.9 million mobile phone subscriptions as of Q4 2017, according to the Uganda Communication Commission 7 (which may include individuals with multiple phones or internet connections). A simple survey sample calculation indicates that our sample of 2,918 represents the population of Uganda with a confidence level of 95% and confidence interval +/-2. Quantitatively speaking, the sample size is significant. It should be noted that the survey included logic flow (some questions were answered based on previous answers) and no questions were mandatory, so the number of respondents changes from question to question. Methodology It is important to note that these results are not perfectly scientific nor entirely random, and they are likely affected by various response biases. Respondents volunteered their answers based on exposure to the survey within its 3-day circulation (from 7pm Friday 13 th July to 5pm Monday 16 th July, 2018), though some strategy was employed to collect balanced responses. The survey was hosted on surveymonkey.com and shared primarily through social media, but it was also conducted face-to-face by pollsters in all four regions across Uganda. Within 24 hours after closing the survey, data was cleaned, answers tagged and 6 United Nations Population Fund Uganda. World Population Dashboard Uganda. URL: 7 Uganda Communications Commission. Communication Sector Performance for the Quarter ending December Web. 16 July,

9 tabulated, and initial analysis conducted by the Whitehead Communications team in Kampala, Uganda 8. Social Media Sample The majority of responses were collected by sharing links to the survey through social media and encouraging people to respond on their phone, then pass it on. Social media distribution included primarily WhatsApp 9, Facebook and Twitter. It must be taken into consideration that Uganda has an Internet penetration rate of only about 30% to 40% 10 and so most Ugandans cannot access social media. Therefore, social media users in Uganda are not representative of the population as a whole, particularly the millions of Ugandans who live in poverty. In comparing a social media sample with publicly available data about Uganda, the results differ in gender, level of education, age, and location. Typically, social media users in Uganda are around 60% to 75% male 11, whereas the Uganda Bureau of Statistics reports that Uganda s total population is 51.3% female (94.8 males per 100 females) as of the 2016/2017 Uganda National Household Survey 12. However, significantly more men than women answered this survey (73.4% male), which means that women s views are underrepresented in comparison to the national population. This is despite surveyors actively preferring female respondents in face-to-face interviews and direct link shares in an attempt to balance the trend. The majority of our respondents reported having a university education, yet UBOS reports that only 7.3% of Uganda s population has education beyond 8 The young, upcoming team at Whitehead Communications who assisted in this project include Florence Kakatshozi, Tom Nangosyah, Angella Kizito and others. We chose to release this data publicly and quickly so that others can build on what we collected. 9 The survey links were shared as WhatsApp direct messages and in groups. 10 There is a commonly used is a figure of 31% Internet penetration in Uganda (13 million users in 2017), which appears on Internet World Stats. Uganda Internet usage, broadband and telecommunications reports here: However, Uganda s Ministry of ICT and National Guidance lists the number of Internet users in Uganda at 16 million in its ICT Sector Statistics as of 16 July, 2018: 11 Our experience reviewing the analytics of social media pages that we manage at Whitehead Communications Ltd. in , as well as previous survey data and discussions on the same with professional peers, indicates that social media active users are between 60% - 75% male, suggesting a gender barrier in accessing social media in Uganda. Facebook Audience Insights lists the Ugandan audience as 61% male as of 16 th July, The Ugandan digital marketing and communications industry could benefit from further research on this issue. 12 Uganda Bureau of Statistics. The Uganda National Household Survey 2016/17. Web. 16 July, Final_Presentation.pdf

10 Secondary School level 13. Also, our survey removed any responses from people who reported that they were under the age of 18 in an abundance of caution, since we did not have parental consent, and yet 54.1% of Uganda s population is under 18 according to UBOS 2017 projections 14, so children s voices were also not represented. Uganda s social media users are mostly residing in Kampala and Wakiso Districts (84.1% according to Facebook Audience Insights), which make up the urban center around the capital city of Kampala in Uganda s Central Region 15. While sharing the survey online, our team activity targeted people upcountry the rural areas in Central, Western, Northern and Southern Uganda by encouraging others to share the survey with their friends outside of Uganda s urban centre. The fact that this survey was hosted online and shared through social media means that it has over-sampled a digitally literate sub-section of Uganda s population, yet there are only about 13 to 16 million Internet users in Uganda 16 and only 2.5 million active social media users 17 as of Other sources in Uganda s Government and industry can provide updated figures on user activity. This survey gathers 3,015 voices, and has managed to include a wide spectrum of public opinion despite systemic challenges. Face-To-Face Interviews In order to balance out the social media effect (as explained above), we facilitated 13 volunteer pollsters to conduct face-to-face interviews across different regions of Uganda. Face-to-face interviews were conducted in the following locations: 1. Kampala and Wakiso Districts (Central Uganda); 2. Gulu town (Northern Uganda); 3. Karamoja Region, Mbale and Jinja towns (Eastern Uganda); 4. Mbarara, Rukungiri and Ntungamo (Western Uganda). 13 Uganda Bureau of Statistics. Uganda Facts and Figures on Gender. Web. 16 July, Uganda Bureau of Statistics Statistical Abstract. Web. 16 July, Facebook Audience Insights indicates that 84.1% of its audience in Uganda is located in Kampala District or its neighbouring Wakiso District as of 16 th July, Web The Internet penetration rate is listed by Internet World Stats as 13 million or 31%, but the Uganda Ministry of ICT and National Guidance ICT Sector Statistics report 16 million (39%) as of 16 July, Hootsuite. Digital in 2017: Eastern Africa. Web. 16 July,

11 Each pollster s responses were tracked using a unique link, and they were able to enter multiple responses on their phone while interviewing subjects. These responses were mostly collected face-to-face, though pollsters also shared their links with friends using social media. Through the social media grape vine, we also managed to reach many respondents outside of Kampala/Wakiso, and several outside of any city or town (see Respondent location below in results by question). Data Cleaning The Whitehead Communications team 18 conducted basic data cleaning immediately following the closure of the survey. This included the following: Removing spaces and delimiting the location information to discern in which districts the respondents reside; Spell check of open-ended questions, particularly the spelling of districts; Eliminating blank spaces for the data sets we had not included ( , name etc.); Filtering the data to eliminate respondents that identify themselves as residing outside of Uganda (though some remained due to misrepresentation or lack of clarity); Using the sort function and the find and replace functions to edit spellings and remove data that wasn t useful for analysis; Using tags to analyse open-ended questions and identify themes; Conducting general analysis in Survey Monkey, then STATA and applying cross tabulation to mine further insights. 18 The data review, cleaning and analysis team was led by Tom Nangosyah and lead surveyor Anne Whitehead.

12 Results by Question Age Question 1: Your Age Response: % % % % % % % % % % 80+ 0% % Age Your Age Freq. Percentage % ,183 41% % % % % % % % % % % Total 2, %

13 Gender Question 2: Your Gender Response: Other 0% Female 26% Male 74% Gender Gender Freq. Percentage Female % Male 2,138 73% Other % Total 2, %

14 Respondent location Question 3: Where do you stay? Please indicate Village/Parish, Sub-County, and District) Response: Breakdown by region North 8% East 5% West 15% Central 72% Respondent location by region Regions Freq. Percentage Central 2, % West % North % East % Breakdown by district Location by District District Freq. Percentage Abim % Adjumani %

15 Amuria % Arua % Budaka % Bugiri % Buikwe % Bukomansimbi % Bulambuli % Buliisa % Bundibugyo % Bushenyi % Busia % Butaleja % Butambala % Buyangabu % Buyende % Dokolo % Gomba % Gulu % Hoima % Ibanda % Iganga % Ishaka % Isingiro % Jinja % Kabale % Kabarole % Kabong % Kakumiro % Kalangala %

16 Kaliro % Kalungu % Kampala % Kamuli % Kamwenge % Kanungu % Kapchorwa % Kasese % Kayunga % Kibaale % Kiboga % Kiruhura % Kiryandongo % Kisoro % Kitgum % Kole % Kotido % Kumi % Kween % Kyankwanzi % Kyenjojo % Kyotera % Lamwo % Lira % Luuka % Luweero % Lwengo % Lyantonde % Manafwa %

17 Maracha % Masaka % Masindi % Mayuge % Mbale % Mbarara % Mitooma % Mityana % Moroto % Moyo % Mpigi % Mubende % Mukono % Nakaseke % Nakasongola % Nebbi % Ntungamo % Nwoya % Omoro % Pader % Pakwach % Paliisa % Rakai % Rubanda % Rubirizi % Rukungiri % Sheema % Sironko % Soroti %

18 Tororo % Wakiso % Wobulenzi % Yumbe % Total 2, % Education Question 4: Your level of education (completed so far) Response: Vocational CertiTicate 9% Primary 1% Secondary 15% Other (please specify) 3% None 2% Bachelor's Degree 56% Graduate School (Ex. Master's, PhD) 14% Level of education Freq. Percentage Bachelor's Degree 1, Graduate School (Ex. Master's, PhD) None Other (please specify) Primary Secondary Vocational Certificate Total 2,

19 Occupation Question 5: What sector do you work in? (Please select all that apply.) Response: What Sector do you work in? Agriculture 2% 2% 8% 7% 6% 4% Arts&Entertainment Business & Trade Education 8% 18% Entrepreneurship Fintech 3% 4% 4% 5% 2% 2% 10% 4% 4% 7% 1% Health Information, Communication Technology Law Manufacturing Marketing & Communication What sector do you work in? Freq. Percent Agriculture 243 8% Arts&Entertainment 147 5% Business & Trade % Education 164 6% Entrepreneurship 271 9% Fintech 42 1% Health 178 6% Information, Communication Technology % Law 97 3% Manufacturing 62 2% Marketing & Communication 204 7%

20 Mobile Money 176 6% Non-Government Organisatiosn 162 5% Public Service 104 4% Student % Tourism 64 2% Transportation 75 3% Unemployed % Others Total 2967 Sample social media users Question 6: Have you used social media in the last 6 months? Response: No 4% Yes 96% Have you used social media in the last 6 months? Freq. Percentage No 121 4% Yes % Total %

21 Current social media users Question 7: Have you used social media since the OTT tax was implemented (July 1 st, 2018)? Response: No 15% Yes 85% Have you used social media since the OTT tax was implemented (July 1st, 2018)? Freq. Percentage No % Yes % Total %

22 Use of social media OTT platforms Question 8: Which social media services do you use? (Please select all that apply.) Response: Which social media services do you use? Social media sites 360 Chat Telegram Tinder linkedin Twitter Freq. Perecent WhatsApp Number Which social media services do you use? (Please selects all that apply.) Freq. Percent WhatsApp % Facebook % Twitter % Instagram % linkedin % Skype % Tinder 106 4% Snapchat % Telegram % Google Hangouts % 360 Chat 75 3% Other (please specify) 158 6% Total 2708

23 Method of social media access after tax implementation This question was only asked to those who reported to have accessed social media in July, * Question 9: How are you accessing social media? (Please select all that apply.) Response: How are you accessing social media? Access t social media Other ( please specify) I use WiFi / Hotspot(s) I use VPN I paid the OTT tax Number How are you accessing social media? ( Please select all that apply.) - OTT tax Freq. Percent I paid the OTT tax 1,089 40% I use VPN 1,545 57% I use WiFi / Hotspot(s) 1,036 38% Other 91 3% Total 2,696

24 Tax payment (dependency) This question was only asked to those who reported that they are paying the OTT tax, or other. Its intention was to check the dependency Question 10: Who pays your social media tax? Response: Spouse / partner Other (please 3% specify) 3% Work / employer 3% Family 3% Telecom service provider 0% Friend 2% I pay for myself 86% Who pays your social media tax? Freq. Percent Family 36 3% Friend 22 2% I pay for myself % Other (please specify) 29 3% Spouse / partner 27 2% Telecom service provider 4 0% Work / employer 37 3% Total 1, %

25 What people use social media for in Uganda Question 11: What do you use social media for? (Please select all that apply.) Response: What do you use social media for? Answer Other (please specify) News Education and Research &Communication with family and friends Freq. Business, sales and marketing Respondents What do you use social media for? (Please select all that apply.) Freq. Percent Business, sales and marketing 1,827 69% Entertainment 1,686 64% Communication with family and friends 2,328 88% Education and Research 2,038 77% News 2,067 79% Other (please specify) 112 4% Total 2,633 Ugandan e-commerce Question 12: What kind of business do you conduct online? Response: This question generated responses from 1,645 people conducting business online in Uganda. Results indicate that there is a wide variety of e-commerce in Uganda, with marketing being the most common (46% of tagged answers).

26 Types of businesses that are currently operating online in Uganda include: Accounting Agriculture / Agri-business Art Automotive sales Aviation Bakery sales & marketing Beauty product sales Clothing sales Consultancy Counseling Data entry Dog sales Electronics Events promotion Fashion Forex Furniture design Graphic design Law Marketing / advertising / communications Mechanic / maintenance Medical Mobile money Music promotion Photography Poultry feed sales Publishing Research & development Retail Shoe sales Shopping Social media influencer Solar power Sports betting Telecommunications & phone sales Travel & tourism promotion Web applications developer Other business conducted online in Uganda includes: Communicating with clients, patients, suppliers, colleagues, etc. Customer service Digital marketing Employment search & recruitment Market research Meetings with colleagues Planning work Publishing creative writing, reports, journalism, entertainment, etc. Research Reservations, bookings Sending and receiving documents Sharing opportunities (ex. scholarships, employment) Tendering and proposals Trade (ex. International purchases & sales) Results for this question are included in Annex A.

27 Impact of OTT tax on Ugandan e-commerce Question 13: How has your business been affected by the OTT tax? Response: This question generated 1,640 responses. Several themes were observed in the open-ended responses, including: Delays in conducting business Disrupted payments Inconvenience Increased cost of doing business Loss of income Reduced access Reduced online audience Examples of these themes as they present in actual responses: Delays o There is slow communication from customers and am losing some of them o Delayed communication to my clients due to poor network with the mobile money transactions a times o Can't be online for most of the time like before which has led to delayed replies and missing out or loosing clients Disrupted communication o Reduced communication with potential buyers o It has almost kicked me out my customers' response decreased by almost 80% o Affected my communication with my project caretaker Disrupted payments o The startup projects we are working on rely on mobile payments from our users. Because of the new tax, our future isn't as certain anymore unless we pivot towards using other forms of payment o We process mobile money payments for SMEs but with all this tax we can barely make a dime o Less orders, less traffic which automatically translates to less money made and given the MM tax, good lord, absolute nightmare given that that's my only mode of payment. Looking to start having payment on delivery as an option. Increased cost of business.

28 o Prices are higher and business is slow o OTT tax is just too much. I have to pay extra money to do my business online and yet I haven't added that tax on my sales. o Some of my clients and business partners are offline or the irregular which makes it expensive to contact them using other means o Our online audiences have substantially dropped and we are now spending more on promotion of our clients Facebook and Twitter pages while earning the same retain fees o Costly limiting my savings o It's too expensive to buy both airtime and subscribe monthly for bundles. So I have to reduce on my posts and also reduce on my client survey and search because I cannot afford to develop content for many who are not willing to pay as much Loss of income o Reduced viewers hence reduced customers o My sales have dropped ever since it started o It has almost kicked me out my customers response decreased by almost 80% o Customers can no longer pay for their stock using mobile money because of the charges incurred o I can t access my customers any more since most of them cannot access social media,hence I am running broke Reduced online audience o I m reaching less people especially those within Uganda. o Increase cost of business Reduced online audience Have few people to view my adverts and limited buys or no...it's even expensive to make calls so WhatsApp and facebooking was cheaper o Lesser engagement, even when I boost. Lost some of my clienteles who are affected by the annoying Taxes. Inconvenience o My internet expenses have increased; the inconvenience of paying through mobile money; Using The students that I work with aren't able to communicate because they now can't afford to go online o Even though I am able to access the internet, not all my customers have easy access to my services. My customer base has depleted as a result. It is inconvenient to most and now I have to find other ways of making my service more accessible to my customers, this will be more expensive. I make a plea to the government of Uganda to reconsider this decision, they need to know that it will negatively affect as a country, economically. We cannot move steps behind

29 with the word moving forward. Instead of taxation, we should place priority on the agricultural sector, increase our exports and then we won't have to tax an already impoverished nation. o It s an inconvenience to pay daily yet my business already pays tax Reduced access o No longer online due to inability to pay tax o My clients are hard to access o Many of my clients can no longer access media yet it is the easiest way to communicate o Affected my communication with my project caretaker o When I see my liked post on product posts is small. Receive a few calls from potential customers than I did before and they are fewer people online. most people I think use social bundles but now it is not worth using them o Sales have deteriorated because I hardly access social media and same applies to potential clients. Results for this question are included in Annex B. Inconvenience of OTT tax Question 14: Is the OTT Tax on social media inconveniencing you? Response: Slightly 2% Not at all 6% Very much 17% Moderately 4% Extremely 71%

30 Is the OTT Tax on social media inconveniencing you? Freq. Percentage Not at all 150 6% Slightly 48 2% Moderately 110 4% Very much % Extremely 1,848 71% Total 2, % Inconvenience of Mobile Money tax Question 15: Is the Mobile Monday tax inconveniencing you? Response: Not at all 2% Moderately 2% Slightly 1% Very much 12% Extremely 83% Is the Mobile Money tax inconveniencing you? Freq. Percentage Not at all 45 2% Slightly 24 1% Moderately 48 2% Very much % Extremely 2,156 83% Total 2, %

31 % Sample using Mobile Money Question 16: Have you used Mobile Money in the last 6 months? (Ex. MTN Mobile Money, Airtel Money, Africell Money.) Response: No 7% Yes 93% Have you used Mobile Money in the last 6 months? (Ex.MTN MM, Airtel Money) No 176 7% Yes 2,430 93% Total 2, %

32 Change in Mobile Money use after tax implementation Question 17: How has your Mobile Money use changed since the Mobile Money tax was introduced? Response: Transacting more money in July 4% Other (please specify) 2% Transacting less money in July 44% Stopped transacting on Mobile Money i.. 47% Transacting about the same as before 3% How has your Mobile Money use changed since the Mobile Money tax was introduced? Freq. Percentage Other (please specify) 55 2% Transacting more money in July 90 4% Transacting about the same as before 58 2% Transacting less money in July 1,027 44% Stopped transacting on Mobile Money in July 1,101 47% Total 2, %

33 Mobile Money use breakdown by gender Gender vs Mobile Money use since tax was introduced Gender by Number Other (please speci.. Stopped transacting.. Transacting about t.. Transacting less mo.. Transacting more mo.. Female Male Other Mobile Money Use since Tax was introduced Your Gender How has your Mobile Money use changed since the Mobile Money tax was introduced? Female Male Other Total Other (please specify) Transacting more money in July Transacting about the same Transacting less money in July ,020 Stopped transacting in July ,092 Total ,315 Change in Mobile Money use by Mobile Money agents Transacting more money in July 5% Transacting less money in July 57% Other (please specify) 0% Stopped transacting on Mobile Money in July 38% Transacting about the same as before 0%

34 Mobile Money use change - MM agents Freq. Percent Transacting more money in July 10 5% Transacting about the same as before 1 1% Transacting less money in July % Stopped transacting on Mobile Money in July 74 38% Total % % Sample that are Mobile Money agents Question 18: Are you a Mobile Money agent? Response: Yes 8% No 92% Are you a Mobile Money Agent? Freq. Percentage No % Yes 197 8% Total %

35 Mobile Money agents breakdown by gender Your Gender Are you a Mobile Money agent? Female Male Other Total No 518 1, ,123 Yes Total 580 1, ,319 Impact of Mobile Money tax on Ugandan businesses Question 19: How has the Mobile Money tax affected your business? Response: This question generated 2,334 responses. Several themes were observed in the open-ended responses, including: Delayed payment Inconvenience Increased cost of doing business Increased risk Loss of income Revert to banking Revert to cash Examples of these themes as they present in actual responses: Delayed payments o I can't send my working capital to the projects caretaker because of that tax. o It has delayed my services for example I have to move to take money to my relatives. o It has brought about late payments as clients only wait when they get time and travel to the business premises to pay in cash to avoid tax charges o People no longer want to send their payment via mobile money, they want me to go directly pick it from them yet at times am always busy, so this affects my work o It delays my payment's I have to look for people to pay me physically since they don't want to pay exorbitant charges

36 Inconvenience o I have to walk distances to pick money from the person am dealing with yet initially they would just send me the money...so I waste a lot of time traveling instead of concentrating on looking for more customers. o Most of my customers have been using mm to pay me hence it has declined my income because the customers find it hard to bring the money physically o It's a bit cumbersome because you have to invest in transport in order to go pick up clients' payments Increased cost of doing business o Increase cost of business I no longer make transactions on mobile money with my clients as before coz the cost is high. This affects my business o I have a small business home of wines and spirits.my employee deposited daily sales on my airtel money then remit back some cash to his account the following day for liquor purchase and other daily bills expenses. This No longer work I No longer daily supervise my cash the new tax has made it impossible since it just reduces cash that would be used for other incentives. o Incur greater costs for transactions. The bigger margins in taxation could have been reinvested in my business or out to other profitable use o At first I used to save with my bank using my mobile money as clients could also find it easy to pay some of their balances using mobile money, not only that I even used to call for more funds from home via mobile money in case I was in town (Kampala city Centre) and what I had gone within the place wasn't enough as we all know and understand the inflationary tendencies in our country. I could really do a lot with my mobile money but all this is no more because at times now we if are to be calculative you find that moving funds physically is more cost effective than carrying out a mobile money transaction, it may be time consuming... But look what to do...?if that's what the government is dictating in such an era Anyway mobile money and social media tax have affected my "kasmall" business negatively Increased risk o Inconvenience We sell and promote different products and services online the easiest and most affordable means to complete these Transactions was mobile money with also risks involved with carrying liquid cash d Taxing during transactions plus commission on the Transaction makes easy turn to hard in other words it's

37 financially inconveniencing 3 parties the Telecom, Agent and customer o The fact that there is a delay on the specific tax levied has made my work at the farm to require constant money to get tasks done for instance if I need transportation of animal feeds I have to travel directly to pay the supplier something that wasn t happening. I feel there s a huge risk at the moment especially when handling huge amounts of cash at hand. o Increased costs on transferring of liquid money to reach my workers and also high risk since I have to carry a lot of money from one place to another to dodge high charges on sending and withdrawing Loss of income o Low commission o Business is so low that sometimes I don t work o It has led to loss of money in its way of withdrawing n deposit..i.e. the 200 would have done so much in something else s o Transaction carried on mobile money have reduced and my clients don't want to transact with it again o Let me even talk luganda,business kati mye ffe bakasitoma abasinga twalina ba mubyalo nga bawereza ssente netubagulira ebintu netubawereza kati berinyira emotoka nebaja,bagamba baffisa kingi nga betukidde,okusinga okuzononera mubanga. Revert to banking o I'm transacting way less on Mobile Money, means I have to use the bank more often. o Charges are high rather bank it for someone Revert to cash o I stopped using mobile money as payment method because it will be a loss to me. Then some i can't deal with remote customers o has inconvenienced me extremely because have been getting money through it, now most people prefer to use other means. o I had to go back to gulu to pick my school fee since it was expensive to use Mobile money. o Well I was starting to use Mobile Money as an alternative method to save money as well as send money and pay for services but now I think I will go back to the old days of having to carry around physical cash as well as using a piggy bank to save. Results for this question are included in Annex C.

38 Public support / opposition of the social media tax Question 20: Do you support the social media OTT tax? Response: Strongly support 1% Undecided / neutral 2% Do not support 21% Somewhat support 3% Strongly oppose 73% Do you support the social media "OTT" tax? Freq. Percent Strongly support 26 1% Somewhat support 69 3% Undecided / neutral 55 2% Do not support % Strongly oppose 1,827 73% Total 2, %

39 Public support / opposition of the Mobile Money tax Question 21: Do you support the Mobile Money tax? Response: Strongly support 0% Undecided / neutral 1% Do not support 19% Somewhat support 1% Strongly oppose 79% Do you support the Mobile Money tax? Freq. Percent Strongly support 12 0% Somewhat support 26 1% Undecided / neutral 25 1% Do not support % Strongly oppose 1,970 79% Total 2, %

40 Ugandan public opinion on taxes in general Question 22: What is your opinion on taxes in Uganda? This question generated 2459 responses. Several themes were observed in the open-ended responses, including: Accountability Double taxation Financial Inclusion Misuse of tax funds Over taxing Planning Taxation method of implementation Examples of these themes as they present in actual responses: Overwhelming tax. Too much double taxation. Unbearable and not sustainable for business startups & smaller businesses. We pay a lot of taxes. I think this one should be scrapped for financial inclusion and achieving middle income status. Paying taxes is okay, but the constant misuse of taxes collected is the problem. I don t think the long term effects are put into consideration. I think all that is thought about is the tax turnover. They are unfair to the people, government also needs to give accountability to the public Those who implement, they don t think/make enough survey before embedding those taxes. Social media and mobile money tax is just affecting poor people. Indirect tax should be the way to go. Taxes per say are not bad and they are required. However when you tax people to utilize a service you didn t create that s crazy. For MM tax that is going to affect financial inclusion and it is going to be a deterrent. Results for this question are included in Annex D.

41 Acknowledgements The Uganda Social Media and Mobile Money Taxes Survey was led by Anne Whitehead, the author of this report, though it was absolutely a team effort. The idea to conduct this survey can be credited to Florence Kakatshozi, who also served as assistant lead coordinator. Tom Nangosyah and Angella Kitizo assisted in data cleaning, tagging and editing. Those conducting face-to-face interviews included Ojara Ronald and Frank Sha Cui (Gulu), Derrick Kabuye and Nakimuli Rytah Flower (Kampala/Wakiso) and Norman Manley (Mbarara), among others. We are especially grateful to everyone who helped share the survey and responded to it themselves. Thank you for contributing to the public record. We are also grateful to those who review this report, forgive any errors and teach us better, share it and put it to good use. If any further information is required to build on these findings, kindly contact us at the below.

42 Kindly contact for full text. ANNEX A: Ugandan e-commerce What kind of business do you conduct online? Freq. Percent % I sell my beats on line. -I promote % Accessories 1 0.1% Accounting 1 0.1% Activating accounts for Startimes cus % Activating satellite receivers using % Adivetising mi shoes 1 0.1% Adivtise my whole sale business 1 0.1% Advert 1 0.1% Adverting my business and Gospel 1 0.1% Advertise cleaning services 1 0.1% Advertise my business 1 0.1% Advertise my clinic 1 0.1% Advertise my commodities from here 1 0.1% Advertise my restaurant 1 0.1% Advertise my work 1 0.1% Advertise phones and other business 2 0.1% Advertisement 4 0.2% Advertisement 5 0.3% Advertisement and accountability 1 0.1% Advertisement and marketing 1 0.1% Advertisement of other business 1 0.1% Advertisement of our company work, di % Advertisements 1 0.1% Advertisements 1 0.1% Advertising % Advertising % Advertising 1 0.1% Advertising Online buying &selling 1 0.1% Advertising and connecting with my cu % Advertising and interacting with pote % Advertising and sales for variety of % Advertising and teach youths about fa % Advertising businesses to get commiss % Advertising cars new and old 1 0.1% Advertising clothes and home appliances 1 0.1% Advertising for my products and reach % Advertising for our school 2 0.1%

43 Advertising for products 1 0.1% Advertising for the goods 1 0.1% Advertising my agricultural produce 1 0.1% Advertising my boutique 1 0.1% Advertising my business 1 0.1% Advertising my business 1 0.1% Advertising my business and offering 1 0.1% Advertising my business pages,thru' t % Advertising my businesses 1 0.1% Advertising my crafts 1 0.1% Advertising my goods 1 0.1% Advertising my institution 1 0.1% Advertising my merchandise 1 0.1% Advertising my mobile money business 1 0.1% Advertising my new stock to my custo % Advertising my products 3 0.2% Advertising my products 2 0.1% Advertising my products % Advertising my small business 1 0.1% Advertising my small retail boutique 1 0.1% Advertising my work, business 1 0.1% Advertising on the website 1 0.1% Advertising products 1 0.1% Advertising products 1 0.1% Advertising t shirts 1 0.1% Advertising the School 1 0.1% Advertising the company's current act % Advertising website devt 1 0.1% Advertising, Accounts 1 0.1% Advertising, research 1 0.1% Advertisment 2 0.1% Advisory 1 0.1% Agribusiness Consultancy, and Uganda % Agricultural 1 0.1% Agricultural produce and marketing 1 0.1% Agricultural products 1 0.1% Agriculture 1 0.1% Agriculture 3 0.2% Agriculture and health 1 0.1% Agriculture business 2 0.1% Agriculture produce Sales 1 0.1% Agriculture research 1 0.1% Agro 1 0.1% Agro business 1 0.1%

44 Agro business (agriculture) 1 0.1% Agro-farming 1 0.1% Airbnb 1 0.1% Aircraft charter brokerage. Parts sal % A lot 1 0.1% Am a blogger 1 0.1% Am a digital marketer which implies m % Am a farmer too so I use to talk to m % Am a fashion and design person 1 0.1% Am a village man who grows crops that % Am in the business of communications % Am planning to display my products on % An aero engineer, John is husband to % An online marketing of aluminium prod % An online shop for clothes 1 0.1% Animational advertising to get projects 1 0.1% Any kind 1 0.1% Architectural 1 0.1% Arts 1 0.1% As an artist i sell my pieces online % As an entertainer I sell my musical p % As part of my business, I generate le % Awareness of my products 1 0.1% Bakery 1 0.1% Bakery Washing bay I promote the ab % Banking 1 0.1% Benchmarking and tendering, bidding a % Betting and marketin 1 0.1% Beverages sales 2 0.1% Binary trading 1 0.1% Bitcoin 1 0.1% Bitcoin mining and trading 2 0.1% Blogger 3 0.2% Blogging 1 0.1% Blogging and Entertainment Journalism 1 0.1% Blogging and social media marketing 1 0.1% Book reservations, Reach out to clien % Book sales 2 0.1% Bookings and Reservations 1 0.1% Bookings and Reservations of hotel ro % Boutique 1 0.1% Brand awareness 2 0.1% Brand marketing 1 0.1% Brand promotion,online buying and sel %

45 Branding 1 0.1% Branding and marketing my music 1 0.1% Branding blogging 1 0.1% Business 1 0.1% Business awareness 1 0.1% Business coaching 1 0.1% Business plng 1 0.1% Busnisess woman 1 0.1% Buy and sell electronics online 1 0.1% Buy and sell used Items 1 0.1% Buying and selling 1 0.1% Buying and selling artifacts 1 0.1% Buying and selling goods 1 0.1% Buying goods online 2 0.1% Buying items online 1 0.1% Buying my clothing on Jumia & adverti % Buying online 1 0.1% Buying things online, advertising 1 0.1% By using whatsapp we communicate by e % CONSTRUCTION 1 0.1% Cake business 1 0.1% Cakes 2 0.1% Car for hire business 1 0.1% Car purchases 1 0.1% Car sales 1 0.1% Car sales and real estate 1 0.1% Car selling 1 0.1% Chili business,that is using social M % Cinema 1 0.1% Civil engineering works, 1 0.1% Clickalerts 1 0.1% Clothes and shoes marketing 1 0.1% Clothing 2 0.1% Clothing 2 0.1% Clothing and furniture 1 0.1% Clothing and shoes 1 0.1% Clothing brand marketing 1 0.1% Clothing business 1 0.1% Club promotions 1 0.1% Commercial 1 0.1% Commodities 1 0.1% Communicate my comrades in the busine % Communicating with clients 2 0.1% Communicating with clients n marketin %