Social Media Tax

Facebook is secretly fighting the recently implemented social media tax by the Ugandan government. We learned this from Kojo Boakye, the Public Policy Manager as well as Access and Connectivity for Facebook for Africa, yesterday.

He was speaking at a dialogue event that took place yesterday at Protea Hotel, Kampala.

The dialogue was organized by CIPESA in collaboration with the internet society – the Uganda chapter. It focused on the “Impact of Social Media and Mobile Money Taxation in Uganda.”

According to Kojo there are many things Facebook is doing to fight the tax that he or Facebook may not let the public know about.

“There are many many things we are doing that we can not put in the media,” Kojo said. Adding that he spent the bulk of yesterday [26/08/2018] engaging both government and other concerned stakeholders.

“Across the board, we have been speaking to stakeholders. Most of my time today has been spent speaking to government and stakeholders,” Kojo pointed out.

This was in response to a lady who intimated that Facebook is not concerned about markets that do not significantly contribute to the bottom line.

Also read: Revised mobile money tax and airtime scratch card ban good for building a cashless economy

A few weeks back, there was a message making rounds of social media which intimated that Facebook was going to sue the government of Uganda for levying a fee on a product that they did not own. But, Kojo classified that as fake news.

Reiterating that even if they could take the government to court, that is the best way to resolve the issue from their point of view.

“I don’t think it is something that we are considering doing at the moment, but I also don’t think is the best way to go about this,” Kojo said.

Given he is of Ghanaian descent, Kojo also pointed out that beyond them being ambassadors of Facebook in Africa, they are also ambassadors of the continent within the social media company.

Also read: Here’s what ICTAU and PSFU proposed to parliament before OTT and Mobile Money taxes came into effect

“We are ambassadors for Facebook in Africa. But we are also ambassadors of Africa in Facebook.”

Kojo hinted at some of the adverse effects of the tax. One of them was that this tax will likely render the fiber that the company has so far laid useless.

“We invested millions in fiber that is going to be rendered useless,” Kojo said. He also pointed out that he has engaged bloggers and others whose work has been affected thus far.

“I was with Ugandan bloggers and many are not as able to make money as they were before [the implementation of the tax],” he said.

There’s a couple of reasons to cause concern for Facebook on the recently introduced tax. One is that the company fears that the tax might spread to other (African) countries as long as the Ugandan government walks away “scot free”. For example. Egypt recently started classifying individuals with over 5000 followers or audience as media houses.

Additionally, a new survey of 3015 respondents indicated an increasing use of VPNs among Ugandans. This implies that Facebook advertisers targeting Facebook users in Uganda will not achieve their intended results. Something that goes back to bite the company.

According to Kojo, Facebook doesn’t make a significant revenue out of Uganda. Yet, this move kills any hopes of such revenues becoming significant at one point.

Beyond Facebook, Aga Sekalala Jr – who is setting up the first Angel/VC fund by a Ugandan – also complained about the mobile money and social media tax. This was in an interview I recently had with him.

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