The levy came into effect on Thursday and imposes a 12 percent excise duty on mobile data, pushing up costs in a nation already bogged down by sky-high data fees.
The new tax is part of a government initiative to raise revenue for public services and will replace a fiercely-contested social media tax imposed in 2018, the minister of state for finance and planning, Amos Lugoloobi, told AFP on Friday.
“The new mechanism is to help (the) government achieve its main objective of industrialisation for inclusive growth, employment and wealth creation,” he said.
Opposition leader Bobi Wine, who led 2018 protests against the previous social media tax, said on Twitter that freedom of speech was under attack in a new form.
“We must never stop protesting against these schemes by a paranoid, greedy regime,” said the firebrand singer-turned-lawmaker — who lost to President Yoweri Museveni in a January election.
The new tax will not be imposed on mobile data purchased for research, medical or educational purposes, but it remains unclear how that will be implemented.
Adding to lockdown woes
Moses Serwanga, a communications consultant who doubles as a human rights lawyer, also criticised the tax.
“With the current national (coronavirus) lockdown, many students have been getting educational materials, lectures through the internet. Now it is very expensive for them because of the 12 percent tax,” said Serwanga, voicing hope that the tax could be challenged in court.
“The new tax will impact on businesses, freedom to access information which is a constitutional right, access to education, again a constitutional right,” he added.
Internet user Mary Ruth Akol told AFP she was forced offline as she could not afford data with the new fees.
“The new tax will worsen our situation during this Covid-19 lockdown. We are encouraged to stay home but without internet, it is a bad situation,” she said.
As coronavirus cases and deaths surged to record highs, Museveni last month froze all public and private transport, and imposed a strict dusk-to-dawn curfew across the country of 45 million people.
Under the old arrangement, users of WhatsApp, Facebook, Skype and other social media or so-called “over the top” services which publish content bypassing traditional distributors, were required to pay a compulsory daily fee of 200 shillings ($0.06,0.05 euros) before they could access the sites.
That tax triggered an immediate outcry with thousands of demonstrators facing off against anti-riot police to demand its abolition, fearing it could be used to curb free speech.
Most users turned to virtual private networks (VPNs) to disguise their location and skirt the tax, a trick learned during past elections when the government tried to shut down social media and clipped the projected revenues from the levy.
Museveni — himself an avid Twitter user with 2.2 million followers — at the time defended the tax, saying it will put an end to “gossip”.
VPNs will not be of help this time round as the fees will be embedded in the cost of the data, Serwanga warned.
The East African country has some 18.8 million internet users, according to December 2020 data from the communications regulator.