Bank of Uganda has opposed the new tax imposed on mobile money transactions.
The director in charge of statistics at bank of Uganda Charles Abuka said that the 0.5 % tax on Mobile Money is discriminative and is likely to affect financial inclusion, officials from Bank of Uganda.
He disclosed this yesterday while while appearing before the committee chaired by Rubanda est mp Henry musasizi.
He said that mobile money transactions declined by 672 billion shillings in the first two weeks of effecting the mobile money tax.
The telecommunication companies which include MTN and Airtel Uganda also told the committee that this tax should be scrapped because it will take down the growth of the mobile money industry
The chief executive officer MTN ,Wim Vanhelleputte said that since the implementation of this tax they have lost 30% of their customers on mobile money, indicating that MTN has 6 million users of mobile money though there 23 registered mobile money users.
He said that about 150,000 mobile money agents across the country, with each of them estimated to make 100,000 shillings per month and this has reduced to 60,000 to 65,000 shillings per month and it is likely to go down further if the negative trend continues.
He stated that if the mobile money agents would massively stop their businesses, the mobile money business will be in danger.