“I am hearing this for the first time” Minister Kasaija dismisses plan to tax bank withdrawals

KAMPALA, UGANDA: The Minister for Finance, Planning and Economic Development, Hon. Matia Kasaija, has refuted reports of a plan by government to start taxing cash withdrawals from banks.

Following a February 9 letter addressed to the Governor Bank of Uganda, the deputy secretary to the national treasury in the Ministry of Finance, Mr. Patrick Ocailip indicates that Gov’t seeks the BOU Governor’s opinion on the proposal, and requests that he also avails data on different categories of withdrawals for further review and determination.

“Following our budget consultative meeting held on February 5, 2021 at this Ministry, attended by officials from Uganda Communications Commission, Uganda Revenue Authority, Telecom Operators and Bank of Uganda, it was proposed that we explore taxation of cash withdrawals from commercial banks,” the letter reads in part.

However, in an exclusive interview with the Daily Express, Minster Kasaija said he had not learnt of the letter or known its content but promised to make efforts to establish facts about it.

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“Tax on withdrawal of money? I am hearing this for the first time. Yesterday, we were talking about tax measures and I have not seen that among the tax measures. I am hearing it for the first-time,” Mr Kasaija said.

The proposal to tax cash withdrawals from banks, according to the letter, will encourage cashless transactions and promote e-commerce, improve tax compliance in addition to raising revenue.

Currently, it is only mobile money withdrawals that are subject to a 0.5 per cent excise duty but on the counter while agency banking and ATM withdrawals in commercial banks are not subjected to the same tax.

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